The peak time restrictions play a big part in it too.
Get a train between 4pm-6:55pm out of Euston to Manchester and you can stroll up to any carriage and easily get a seat (more or less). The 7pm trains onwards are a frantic crush and will have people stood up all the way home.
Remove that restriction, coupled with declassifying all but one or two carriages for first class, and there's suddenly a few extra thousand seats a day available.
Agree about flying too. I was seconded in Horsham for a while about ten years ago while living in London and would get the train from Horsham to Gatwick after work and then fly to Manchester if I was coming back up for the weekend, and then do the reverse on the Monday morning. Pretty sure Manchester-Gatwick has been scrapped now though?