It's not a capacity issue, but a cost per seat mile issue. NW believes they will make more money per flight with a 332 than a 742 even with more seats to sell on the 742.
In fact NW says that even with P&I payment to make on the 332's they will still be in the black vs. operating a DC10 or 742.
If anyone here knows more about the costs of operating jets I'd appreciate a demonstration of the costs. I suspect it's a combination of betterfuel economy, reduced on-plan NW staffing requirements and reduced maintenance costs.