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Deham represents the traditional British born and bred East Ender that was traditionally found in London's East End 50 to 100 years ago.
The East End of London is renowned as being the home of the cockney -- that group of people who were born within hearing range of the Bow Bells, a church in the heart of the East End.
It was an area of poverty and great damage during World War Two. The gender notion of men being men and women being women was never so true. The male was the boss of the house who made all the decisions (the reality is that the females ultimately kept the family together) and as the area was fairly "tough" it was important that the man be seen to be tough also (hence is need to battle Thackery at Boxing -- Boxing being valued by tough kids as a measure of masculinity).
Denham was a leader who was looked up to by the other classmates -- the other lads in particular. He was someone who had influence over the other students. When Thackery challenged Denham's informal authority the others were very interested in the result of this power battle. It was important to Denham in this sense to "save face" and keep the respect of other classmates.
Denham was loyal, too. When Thackery spared Denham a "right caning" he showed sympathy for Denham, probably in a way he had never experienced before. This caused Denham to move to "Thackery's side." It was a good strategy by Thackery given the strength of Denham's impact.
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