Any city cyclist will tell you about all the close calls and accidents they've had, so it's just a matter of making a camera that's rugged and cheap enough to meet the demand. GoPro has rugged down, now they just need to come down in price and maybe up in usability.
I think it's different from the Red Bull example because red bull doesn't really offer anything that tons of cheap competitors don't already offer, and with taste being what it is there's no 'default' drink to capture the whole market.
If gopro just became 'the dash-cam' company, and any time you bought a new bike or car it was a $50 add-on at the register, I think they'd clean house.
Of course we're a ways from a stabilized HD camera being an impulse buy, but they're probably the best positioned company to get there. Then they just have to fight commoditization, which is a nice problem to have.
Perhaps this is different in the US, but in the UK people were definitely putting lights on their bikes way before then, because if you didn't you were liable to get stopped by the police. Having a light on your bike in the UK has been the law for at least 30 years.
See: http://greatergreaterwashington.org/post/19284/it-must-have-...
GoPro has a similar mission as Redbull I think, therefore they would be wise to follow the lead Redbull has already proven successful.
Capturing stuff like this is worth it.
You mention "every urban biker in the western world" but unless GoPro figures out someway to make it necessary for every biker in the western world to have a camera attached to their bike how on earth is this a realistic goal to shoot for? That is like saying Redbull is shooting to get their product into the hands of every athlete...it's a silly assumption.