2. Did you mention this to the DOB, including pointing out the difficulties this practice creates?
If the DOB can't see for themselves that this is an inappropriate practice, then he really isn't doing this of the students. As a DOB myself, I give "bad news" to students myself. I will let the students share "good news".
3. Did you point out the way the section leaders and new alternates feel about this, or did you assume they share your feelings.
The student leaders are probably not the ones who are uncomfortable giving the news to the alternates. It is probably the DOB. But, it isn't about the student leaders giving the news as much as it is about the DOB not giving the news. Being told you are an alternate (even if you are not very good and it should be obvious) is tough for a student. It needs to come from someone in charge who (should) genuinely cares about all students' growth. Let me put this to you hypothetically: would you rather be told you are being put on a "growth plan" by the principal or a fellow teacher?
4. Are you genuinely trying to help the DOB? (Do you honestly want him/her to be successful?)
You have the wrong person/people in mind here. It isn't the job of the assistant(s) to make the DOB successful. It is their job (and the DOB's) to make the STUDENTS successful. I say this as a current DOB and a former assistant. If the DOB was interested in STUDENT success, they would have informed the alternates themselves.
5. Do you think the new alternates were surprised about their being designated alternates? (Most were not at all surprised.)
While I'm sure some alternates were not surprised, it doesn't diminish the fact that it still isn't a pleasant thing to hear. See point #3 for clarification if you need it.
6. Are you speaking to the new alternates about their continuing contribution to the band, encouraging them to "hang in there," and helping them improve? If so, are you keeping your disagreement with the DOB's methods a private matter?
Shouldn't this be the job of the DOB? Sure, student improvement is every director's responsibility, but it should be lead from the top down, not from the middle.
7. Is this a big deal in the overall picture or just one more issue that gives you an opportunity to contribute to the DOB's and the band's success?
Again, it isn't the job of the assistant(s) to make the DOB successful. It is their job to make the STUDENTS successful. And yes, this SHOULD be a big deal. You may not think so, but you are not a 14-18 year old student. They have enough insecurities with their peers. They don't need to be told (in not so many words), "You suck at marching band so you are an alternate" by their fellow band members. This is just wrong. The students are not going to see this as coming from the DOB but rather the ones who gave them the news.