why any public transport authority would do seating-only urban buses
To get people to use the bus instead of a car.The average car costs €300/month. Plus about the same amount of opportunity costs, missed by having to control the steering wheel for about an hour per day.
A public transport flatrate in Germany is only €59.
Seems like there is a huge gap in the middle for a better bus experience.
It would not degrade the system but wastly improve it. Because the buses would be additional buses. Each bus taking over 100 cars of the road. A bus can carry over 20 passengers and drive over 10 hours per day. While the average car ride carries 1.1 passengers or so and the car is only used 1 hour per day or so.