Politically it might appear better if the T1 jets were sold to a 3rd party and the upgrade costs used to purchase additional new build ac. Baes insist that they're cheaper to build now, and it would extend OSD, provide a more coherent fleet and buy an extra few years for Baes / HMG to find new export orders before the line has to close. F35 numbers are hard to predict; the initial buy will be far smaller than the 130 jet figure, but given that the line (like the F16's) will be open for decades to come, attrition buys and a modest fleet increase could see the total tail numbers approach 100 over the next 25-30 years.
The only realistic way for the FJ world to expand would be to have a "Tier 2" capability (eg Scorpion/Gripen) to do any sustainment activity after the 'A team' have shaped the battlefield accordingly.