I'm not sure the argument of "Bristol is too close to Heathrow" bears too much examination. BHX is closer to LHR, and the door-to-door (via train, coach or car) times are about the same. (You could apply the same argument to SZG and MUC).
The proximity of LHR also doesn't seem to deter KL, AF, CO, SN, EZY, FR etc. etc. The main catchment of BRS is The West of England, South Wales and a sizeable chunk of people down through Devon and Cornwall.
AFAIK the route trends were good, and pretty much in-line with a route that's only been running a year. LH was the first *A airline to BRS, so it was a standing start against SkyTeam. It just needed commitment, which appears isn't possible in the current environment.
I think they also ran into a problem with LH's main marketing drive in the UK, which is the "£49 to Europe" message, running quite heavily on radio and outdoor in the area. That probably works ex-LHR/BHX/MAN, but it was completely against the route strategy for BRS, which was lower volumes, higher yield pax. Planes yo-yo'ed between good numbers of people paying nothing, or smaller numbers of people paying more. I had several colleagues who were pretty annoyed to find virtually no E avails ex-BRS, and then they were only to FRA! Going anywhere else invoked the curse of LH's YQ, and fares that weren't so good.
I know the LH and BRS teams worked hard to get the route up, and I hope the gap to a return isn't too long. Last time LH left BRS, it was 17 years before they came back.