I think in the days when they planned C.O. offices, those cities _and_ associated metropolitan area were fairly small and not expected to grow too much over the years. L.A. was a special case. The cities you mention were all in the south and until air conditioning was widespread and oil became scarce in the 1950s, there wasn't too much growth expected for them.
In contrast, the 'traditional' big cities were growing rapidly--new commerce and industry, and many immigrants streaming in.
IIRC from the Bell Labs history, the Bell System by 1921 did recognize the need for automated switching. Actually, it was first preferred for isolated areas to save the cost of a 24/7 operator. Switch machines were very expensive and had full capacity whether actually used on not. Human operators only worked when needed.
Labor shortages and expense of humans (lunch rooms, matrons) caused the Bell System to rethink its policy.
Conversion from manual to dial was by no means an indicator of how "busy" an exchange was. There were other factors as well. As mentioned in another post, it was practical for Bell to have manual pay telephones in some resorts into the 1970s. Plenty of busy small towns had manual as late as 1962, probably requiring a huge switchboard. In thinking about two towns I know of, I realize they might have been busy during the day, but virtually empty overnight.