Without answering each question directly, I have thought for a number of years that CO could work DEN as a focus city and do quite well. There are still a lot of CO FF left here in Denver; and, IIRC CO carried about 10% more passengers into and out of Denver this year as opposed to last (there was a story in one of the Denver papers showing traffic for all airlines). Thus, they have some brand recognition without a bit of advertising.

The routes that they would need to fly inlcude DEN-LAX (and maybe DEN-SFO and DEN-SEA) and more lift to EWR basically catering to the buisness traveler. Many of us who live in Denver and fly CO regularly use CO to fly east and someone else for flights west.