They definitely have approval to go to 35m but something in the back of my mind tells me they have to do something physical to actually get there - probably add another satellite?
When they were at 23.5m previously Ryanair were less dominant, they had more easyjet, Air Berlin, Norwegian, possibly others. This time round they are 85% Ryanair which is both a blessing and a curse, blessing in their capacity to deliver large volumes (although looking at the movement in the last set of accounts they appear to be paying very little, if anything, for this growth) - and a curse in that it makes other airlines very wary of setting up there unless they serve a very different market (e.g. Thomas Cook) - for example Ryanair have easily seen off the competition from SAS on Gothenburg (which was predicted).
It was my suggestion that BA had an ulterior motive that triggered the recent tirade against LTNman (must be something about the name) which does suggest a degree of paranoia on this thread (I never made any mention of Luton). Incidentally I have heard several industry figures express this same opinion over the past few days.