They shouldn't have any problems utilizing the B777 on the SIN-KUL route. This route is in fact one of the busiest international route in Asia. There are a lot of Malaysian passengers who fly to Singapore for tansit flights in SIN as there are more airlines flying out from SIN, compared to KUL, i.e. Qantas, BA, Lufthansa, Air France, SAS, United etc.
I don't know how well SIA is doing on the SIN-KUL route, but I think they should be doing pretty well on this route, as they had upgraded their aircraft several times, from A310 to B777 on the peak hour flights. Last time, there is only 1 daily B777 flight, but now, there are more than flights on B777 and A343 than before.
As for MAS, the KUL-SIN route was THE MOST profitable international route for MAS. That's why they utilize on B737 on the route, but B777 and A330 during peak hours, and sometimes even a B747 on that route. MAS wants to provide high frequency on that route, as you almost have a flight within an hour or less if you missed one. They should however consider retiring their B737 and replaced them with B737NG or B717 and provide such high frequency to other Asian destinations such as Jakarta, Bangkok, Manila and Hong Kong.
The flight prices are not that cheap as well, at least 100 USD onwards for a return flight, and the journey time is only 55 minutes. Both MAS and SIA do not have any competitors in this route, except among themselves. Among the other carriers to operate on this route is Japan Airlines and Air India. Qantas used to operate on this route, but dropped out when they suspended their Malaysian services.
I am not too sure if the government of both countries give fifth freedom rights on this route to other carriers, but I do know JAL have got fifth freedom rights on this route.
It would be really fun to see the Sonic Cruiser operate on this route, and how short can the flying time be!