The ATA Saab 340 flights seem to be doing well...at least judging by ATA's traffic releases. ATA Connection has done wonders for Springfield,IL...traffic is way up there. However, most of the ATA Connection cities are still pretty decent sized markets...DSM,GRR,TOL,SBN,DAY,IND,MKE,MSN all have at least 250,000 people.
There just aren't any large markets in states like Montana, Wyoming, North Dakota or South Dakota. I have doubts if people living in those parts of the country will ever see lowfare service. The traffic volume just isn't there....the only way service works is if you use small planes (like RJ's and props) and feed into mega hubs.
There are almost 430 commercial airports in the US. Looking at traffic numbers and population figures, I can't see more than about 150 airports that can support some type of lowfare service. The remaining cities will just be stuck with the major network carriers and high fares. Or in some cases, they will lose air service altogether.