A couple of months ago Rex was quoted as saying that they needed 30,000 pax per year on a route to make it viable. Last year, or perhaps year before that, they publicly identified the routes that they would abandon should they encounter the same crewing problems they faced in 2007. So yes, they do support some routes with other highly profitable routes but they are also willing to abandon them should it be necessary. Put another operator on a currently profitable route and watch both go down the drain.
The whole nature of the aviation business is a move towards larger aircraft. The replacements for the 737NG and 320 will seat more than the current aircraft. Who these days are manufacturing 35 seat regional aircraft? Rex must be looking at a future problem with what do they replace the SAABs' with. Big dollars changing their whole operation to another type.
The public have no idea of the economics of airline operation. For that matter I doubt many pilots do either. QANTAS got behind the publication of an excellent book which explained in some detail the economics of operating transport aircraft and explained the whole concept of economies of scale. I was able to read a fellow pilots copy but I have not been able to find it for sale. If anyone knows of where there are copies I would gladly purchase one. As an aside, it contained some brilliant photographs.