The only thing they could do is block the middle seat and charge premium prices for window/aisle, adjusting the cabin as necessary to account for demand. In other words, a business/economy cabin that flexes based on demand.

Many airlines do this on short-haul: I've flown several different Airbuses (319's and 320's, I think) that did this. But I don't see it on long-haul - that tells me that airlines have indeed run plenty of simulations if not actual live tests and have instead focused on enhancing the real business class with better seats and amenities, not creating more finely differentiated options in coach. Your best bet in coach ends up being the premium economy offerings on a few carriers... The offer to formally pay 100% for the second seat is not always accepted - it's a popular topic on the boards here where the airline has a POS policy. (Specifically, the short skinny guy can't always just throw down cash for the 2nd seat.)