I'm not local to the area so forgive me if I am wide of the mark but looking at Google Maps I see the drive time between Bristol and Cardiff is around an hour. For ANY airline looking to set up in the region this is a significant factor. It may well be easy for Cardiff passengers to hop across to Bristol to use Bristol airport but it will of course be just as easy for people to make the reverse journey. Basically, if an airline can get the right deal to use Cardiff airport there is no reason why the airport shouldn't be able to attract enough passengers to use such services.
It's not quite that straightforward.
Traditionally CWL has found it more difficult to attract passengers from the West Country than BRS does from South Wales, at least in the same numbers or as a percentage of the respective airports' annual passenger numbers. Even when CWL was in its heyday (which will surely return and then grow at some point in the future) in 2007 and 2008 with 2 mppa and with bmibaby firing with three based aircraft, a CAA survey for 2008 showed that over 700,000 passengers with origin or final destination in Wales still used BRS.
The popular sun routes at CWL are fine, especially in summer. It's the other types of route - city, niche and business - where CWL tends to struggle. It has a smaller core catchment than BRS and one which is also less prosperous both in the leisure and business markets although the economy of the Cardiff city region itself is getting stronger. In fact, one recent survey placed it fifth or sixth in the country but this was on a per capita basis. Cambridge was higher in this league table and has no airport worthy of the name: incidentally, Bristol was also above Cardiff in that survey. Per capita measurements are a bit like percentage gains/rises/losses/falls - it depends on what the base figure is.
if an airline is looking to start a route other than summer sun from Severnside, especially if it's looking to use 150-seat plus aircraft, it would normally look at BRS. The reason being that its larger and more prosperous core catchment means that it would need less topping up from the CWL core catchment than vice versa. Add in BRS's location where it draws one million-plus passengers per year from Devon and Cornwall, as well as passengers from the western Thames Valley, Somerset, Wiltshire and parts of Dorset, as well as some parts of Gloucestershire.
Bristol is actually surrounded by airports: Heathrow, which is the default long haul airport for most of the Bristol business community; Birmingham; Cardiff; Exeter and even Southampton for some parts of the BRS catchment. My alter ego once did a post on another aviation forum arguing that Bristol as a city region could actually get by with no airport at all, given the other airports surrounding it. The post was a mixture of devil's advocate and tongue in cheek but there is an underlying truth.
Although these other airports ought in theory to take some of BRS's traffic, in practice they don't, not to any great degree anyway apart from LHR. The converse is that if CWL had a route not operated from BRS some of the BRS catchment would not necessarily regard CWL as their automatic option. They'd also be looking at the likes of LHR and BHX.
The various owners and management of CWL down the years have long been well aware of the need, whilst recognising the perennial difficulty, to attract passengers from outside South Wales - which really means the West of England and South Midlands - but they've yet to find a way of achieving this in meaningful numbers.