I have never really understood the popularity of the 6am flights. Sure you have a whole day at your destination, but you end up being absolutely knackered when you get there. This plus the lack of trains at that time means I avoid them.
It's worth pointing out that not every destination has better timed flights. If I want to fly to London, there's normally only a 6am departure or a 19:00ish departure. Likewise, if I want to go to Malaga, I've got a reasonable 16:00 departure, but the return is at 06:45. It's the same story from London: a lot of destinations are only served early in the morning or late at night, as the LCCs prefer to focus midday flights on higher yielding destinations.
For me, the most dreadful flights are the ones which arrive in the middle of the night at the destination. Wizzair has a cheap Luton-Larnaca flight that is regularly available for 10-20 quid, but you depart at 20:30 and arrive at 03:10. Most of the Larnaca flights are really poorly timed from London though.
Not sure its quite that bad, 03:30 for 05:30 should be alright.
It should be, but you won't get to the airport earlier than 04:30 by train.
I think the whole thing would be a non-issue as long as the airports were friendlier towards people sleeping overnight. I've noticed that in the past 10 years or so, airports have been ripping out seating from landside areas, whereas it really shouldn't be an issue to provide couch-type seating throughout landside areas. Dublin Airport struck me for this: I remember 20 years ago when both departures and arrivals had a lot of very comfortable bench-type seating. Nowadays, it's all been ripped out, with barely any seating available, except in the bars/restaurants there. The end result is an airport that is incredibly unfriendly towards anyone waiting overnight for a flight.