Everyone is assuming the extremes. Someone who flies only leisure fares and becomes the highest level elite is a small minority, and someone who only flies full fare first class/coach but will choose whatever airline is most convenient at the time.

In reality most people are a mix. For example, I act like the former when I fly out of Cleveland and take USAirways connection rather than the Continental nonstop. I act like the latter when I pay full fare on USAirways to get their non-stop.

Am I more important to the airline than the person who ONLY flies on the cheapest fares (but is always loyal?) Probably ... I exhibit the same loyalty as this person but I generate more revenue.

Am I more important to the airline than the person who pays more but shows no loyalty? Maybe, maybe not. I'm sure the airline does profiling to figure this out.

I think the reality, despite whatever people might think is that airlines do view us as revenue streams. Whether we are gushing periodically or a steady trickle distinguishes us and computers at each airline probably spend some time figuring out our value to the airline. And in the end it's up to them.