This solves the chicken and egg problem.
People can make money on this by offering hosting services. It can be a hassle for the average user to run and update the software on their computer so many might opt to pay for a cloud service.
This model can also be used for business discovery. Google and ebay can only do so much, you might want complex querying and reporting.
edit: The software solution can be as simple as publishing rdf data. The Protege ontology editor (open source) is already available. Users could simply start publishing their data profile right away, and conventions would form around what you should be putting in it. Protege also has querying facilities built in already. This was actually the semantic web vision.
my only devil's advocate response would be that if a site delivers very well and people start hearing about people who successfully met on that site (and there isn't a stigma admitting it), then this could drive new users....
1. The only good sites are the ones your potential mate is on. Size is a bigger feature than any you can design.
2. If your site sucks, then people get frustrated and everyone leaves. If your site is great, then people get paired off and everyone leaves.
Online dating doesn't just suffer from network effects, it suffers from second order network effects. Unless you're getting a constant stream of new customers into your site every day, your site will fail.
All innovation in online dating comes from the customer acquisition side, not the product side. If you manage to figure out an innovative new form of customer acquisition, you can make a go at creating a viable new entrant to the market. If you can't, it doesn't matter how good your product is, you will fail.