I would be surprised if DL pulls the route completely - even under current market conditions, because they use it a lot in their advertising and also market themselves as an airline flying to all six continents. Now, I know marketing can be deceptive, but I do think that the flight LAX-SYD flight carries some promotional value, that DL probably regards as significant IMO.

Also, they do invest heavily in the route. I flew it about four weeks ago and saw several ads for the route in Sydney train stations and one of the flight attendants told me that DL is spending more money per coach meal than United, which uses the same caterer. I have to say that the coach meals did look better than what I'm used to on transatlantic routes.

Actually the VA/DL deal would probably entice DL to fly the route more often rather then cut it, because this deal would also allow them to sell code shares for Virgin Blue flights, which would spark more demand as you could now buy one ticket from the U.S. to any location Virgin Blue flies to (including MEL, PER, AKL, and other destinations). I remember reading a post on FT that said Virgin Blue already canceled its code share or interline agreement with United, so it looks like DL could come out on top in the LAX-SYD route.