You're preaching to the choir, man. None of their excuses made sense. As you pointed out, the capital costs weren't really the issue because the feds would have paid for much of it, and the line had something else that most proposals around the country never had, and that's tens-of-millions of dollars in private funds. The operational costs excuse doesn't make much sense, because as you also pointed out, it's cheaper in the long-run to run LRT cars, especially the longer you extend the line, which is why they wanted to build the entire thing at once up to 8 Mile. What this was was a short-sighted decisions by so-called money men that think they know best, but who have absolutely no idea about mass transit. Penny wise and pound foolish, just like they've always been.
Snyder doesn't believe in investing in anything other that corporate tax cuts, and Bing wouldn't know how to run a bus if one ran over him.
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