If it wasn't for the coverage of this incident, I would never have known of the "coffin corner." How would market forces operate on factors of which the public is not even aware?
Like say you design software for something critical like medical devices, and one of these fails and somebody famous dies or a bunch of people die in different places. Suddenly everyone is talking about unit testing and software verification as it pertains to your field, someone with a talent marketing starts up safercoding.com and so on. I'm not sure the stock of human knowledge has really gone up.
And when I got my CS degree we specifically studied accidents where bad software in medical devices killed people. I recall an X-ray machine where the hardware was upgraded and a bunch of software assumptions about when the fuses would blow became wrong. That ended up killing people.
And as someone who has written software for medical instruments I can tell you unit test coverage is part of the contracts we sign.
The coffin corner only played a small part in the accident but that's how accidents always happen. It's always several small things that go wrong together.
A safe airline would not flaunt its safety record, but it's safety practice. Not flying the coffin corner would remove that one part that can go wrong from any future accident scenario.
The safe airline having an accident would not automatically bankrupt it, every other airline has had accident and this one would continue with its safer then average practices.
However, I agree with you this will never happen because as you say the airlines are a crap commodity business. Even Warren Buffet has mentioned how bad a business airlines are for investors.
That's why even though I consider myself a libertarian I want a government mandate to stay out of the coffin corner.
We already have much more complex and difficult to enforce regulations on airlines, this one is simple and would be easy to enforce as we already track all planes on rader closely all of the time.
Furthermore, the first time such a company did have a fatal or obviously dangerous incident, they'd go insolvent immediately. I see the point you're trying to make but it's simply impractical in a mass market like commodity air travel. Uber-expensive executive flying, perhaps.