I think the first thing people need to get past if running their own school is that class sizes, how much money you make etc do not equate to a successful school necessarilly. Some of the best , most reputable schools I know have a small number of students and run out of someone's garage. If I were to run two schools, one soley to make as much money as possible and the other to offer the best possible martial arts instruction, I would run them very differently. Thats certainly not to say a good school cant be a big profitable school (there are many of them around), but I certainly dont judge the quality of a school by how many students they have or how expensive a car the owner drives.
I find that financial success of the school is tied to how business savvy the school owner far more than what the art or the quality of the instruction is. Notice what Puunui said about the flood of Korean instructors coming over and opening schools; they're all college grads who have been specifically trained and groomed to open and operate large commercial schools. Wouldn't matter if they were doing hapkido, yudo, tangsudo, or taebo; they have been set up to succeed before they ever broke ground. That doesn't make their art better. It simply means that they, collectively, are better prepared to run financially successful commercial schools than school owners in other arts collectively are.
Steve made a good point in the other thread, just because something didnt work for you doesnt mean it doesnt work. The school I train at does all the things that you aparantly cant do if you want to be a large successful school and yet we just had a record year for new sign ups and business is booming despite an economic crisis.
Ferrari has record years too. They make great cars. And they will never, building the type of cars that they do, ever be as large as Honda, GM, Ford, Nissan or Toyota, or even Subaru. Are they successful? Yes. Are they a major player in the automotive business? Not in the grand scheme of it. Outside of F-1 prestige (something Honda, Renault, and Nissan among others also have) and success with a tiny market segment, nobody considers owning them. Same goes for Lamborghini, Pagani, and other small volume exotic manufacturers. Manufacturers who make cars that cost as much as a house tend not to have a very big market share.
Ferrari is a major player in a niche market and in F-1, but not in the general industry. They enjoy that success precisely because their business model mitigates against being as large as a GM, a Honda, or a Toyota.
It really comes down to knowing your market and remaining relevant to that market. In terms of the big picture, the business model of your school will not have the same broad appeal as that of KKW/WTF taekwondo. But that isn't an indictment against what your school does; it simply means that you cater to a smaller, more specific demographic and do so very well.