Yes, this will definitely be an option for people traveling to MEA as well as South Asia.
It IS a BS issue -- although I know Air Canada apologists here will disagree. More choice is almost always a good thing for consumers. Transport Canada's stated position is to try to negotiate rights for direct traffic, arguing that airlines such as Singapore and Emirates are gunning for transfer traffic since they can't support a non-stop. True. And this is no different than what Air Canada does in conjunction with Lufthansa to hub ME and South Asian traffic via Frankfurt.
The problem is compounded by the fact than in many ways Air Canada still behaves like a monopoly. All one has to do is look at the whole saga with Toronto Island Airport. Air Canada basically left YTZ to rot while focusing on building up YYZ -- that is, until Porter Airlines came in and was hugely successful. Suddenly, Air Canada is banging on the door, demanding to be let into YTZ again.
With more competition at YVR, my belief is that Air Canada would respond to defend its market share, resulting in more flights and better connections.
I'm sure YVR has been putting pressure on the Federal Gov't. I'm just not overly optimistic the situation is going to change anytime soon.