Best Answer
Some dictionaries do list /ljuː/ in second place
"Revolution" can be pronounced as /ˌrɛ.vəˈljuːʃn/ for a speaker who still maintains a distinction between onset /lj/ and /l/. Longman Pronunciation Dictionary (John Wells, 2000 edition) shows a pronunciation with /ljuː/ second behind the one with /luː/. Most dictionaries tend to leave out old-fashioned pronunciations, even if there are still technically some speakers who use them.
I'm an American English speaker who doesn't have onset /lj/ at all. As you stated, some speakers (British English) have onset /lj/ in some words but not others where it was originally present. I don't know why some specific words, such as lure or lunar, might show greater or lesser frequencies of /lj/ vs. /l/, but it isn't an etymological distinction.
Loss of /j/ in words spelled with "lu" was already pretty well advanced in the early 20th century: the first edition of Fowler's Dictionary of Modern English Usage (1926) states that although pronouncing lute as /ljuːt/ was "formerly de rigeur", and lu was "usually" pronounced with /lj/ in certain words such as lure, lurid, lubricity, it was "usually" pronounced with /l/ in other words including lunar, lute, illumine, evolution. While I don't see "revolution" in the list, I'd guess its pronunciation would for most speakers parallel that of "evolution".
I'm not sure exactly what you consider "more traditional British pronunciation", but I would find it odd if you viewed Fowler 1926 and Wells 2000 as insufficiently conservative representatives of that kind of pronunciation. So my advice would be to pronounce revolution with /ˈluː/.
General background
The phonemes /y/ and /yː/ are not reconstructible in native vocabulary of the dialect of Middle English that is the main ancestor of standard Modern English. In that dialect, Old English /y/ and /yː/ were unrounded as a rule, merging with /i/ and /iː/ before the Great Vowel Shift: for example, Old English mys [myːs] became Middle English /miːs/, which became modern English mice /maɪs/; Old English cyssan [kyssɑn] became Middle English kissen which became modern English kiss [kɪs]. There is a bit of evidence of /y/ and /yː/ surviving in certain dialects of Middle English, but only a handful of modern English words are affected by this. For example, the irregular vowel outcomes in bruise, and blush, much, church can be attributed to divergent dialectal outcomes of Old English /y/ and /yː/. But since the regular outcome of Old English /y(ː)/ is identical to that of /i(ː)/, we can assume that /y(ː)/ was already lost in the target variety of Middle English that adapted French [y] by changing it into a diphthong [iw].
As for length, in general vowels in French words could be adapted in Middle English as long or short, with different phonological contexts favoring one or the other. It doesn't really have much to do with maintaining length from French: stress and syllable structure was more important. Whenever French /y/ came to be lengthened, it ended up merged with native /iw/ (undergoing the same development to /juː/), whereas whenever it came to be shortened, it ended up merged with native short /u/ (undergoing the same development to /ʊ/, and then usually to /ʌ/).
The long outcome is seen in words such as argue, consume, cube and the short outcome is seen in words such as just, duchess.
Compare the lengthening and shortening of vowel phonemes in native English words. Speaking broadly, vowels tended to be lengthened in stressed syllables before a single consonant + schwa, and shortened before clusters of more than one consonant, but it's complicated and there's substantial variability or apparent unpredictability.
That said, the pronunciation of "u" in learned Latinate words such as revolution (its form shows that it was not inherited from Proto-Gallo-Romance: if it had been, its -ti- would have become -is-, as in raison from ratiōnem) is relatively predictable, setting aside the variable application of yod-dropping or coalescence. In Latinate vocabulary, the letter "u" is normally pronounced /ʌ/ before consonant clusters or before a final consonant not followed by silent "e", and pronounced /juː/ before a vowel or before a single consonant followed by another vowel letter (silent "e" included). Words like punish or duchess where "u" is pronounced /ʌ/ before a single consonant + vowel are relatively less numerous and tend not to be Latinisms.
