You're right, Itchin. If LGW got a new runway it would just result in a large scale redistribution from Stansted. Easyjet have shown that yields at LGW are materially higher than those at STN or LTN, and any new slots at LGW would just be gobbled up by a massive exodus from other airports.
That's why MAG are most afraid of LGW R2 getting the go-ahead. Apart from the impact on STN it would also set back MAN's attempts to grow its LCC traffic, as airlines would have to grab new LGW slots by transferring aircraft from existing bases.
But this is all theoretical. In reality, LGW R2 is a financial non-starter. Although it is cheaper than LHR R3 it would still require a very large increase in user charges that LGW's airlines are highly unlikely to stomach. And with easyJet and Virgin opposing LGW R2 it is difficult to see how GAL could raise the finance. GAL R2 is much more likely to require public subsidy than LHR R3, and also to be a another white elephant like BAA's original development of Stansted (which only succeeded due to massive financial support from Heathrow, no longer an option following the breakup of BAA). And there's also the small matter that GAL have said they would need long term protection from new runways being given the go ahead elsewhere in the South East, which I understand would fall foul of 'restraint of trade' legislation.