Excellent point.
You only have to look at the transformation of the North London Line since investment was put in and London Overground took over the line.
In the late 70's and early 80's, the stations were run-down and unwelcoming, and service frequencies were as low as 2tph, if memory serves me correctly.
The idea of making the line freight-only was even mooted at some point. Passenger numbers were a fraction of what they are now, and understandably so. If missing one train by seconds then forces you to wait 30mins, you're going to look at options other than rail for your travel needs.
Looking now at the huge numbers of passengers touching in and out on their Oyster cards on that route, to paraphrase 'Field Of Dreams'...
if you build it, they will come