DECLARE @date1 DATETIME = '20120101'
DECLARE @date2 DATETIME = '20120430';
SELECT a.ID,
       a.locID,
       @date1 AS OperatingDate
FROM   dataset A
WHERE  A.startDate >= @date1
       AND (A.endDate <= @date2 OR a.endDate IS NULL)
       AND A.condition <> 1

DECLARE @date1 DATETIME = '20120101'
DECLARE @date2 DATETIME = '20120430';

;With Months (N)
AS
(
SELECT 0
UNION ALL
SELECT N+1
FROM Months
WHERE DATEADD(mm,N+1,@date1) <=@date2
)
SELECT a.ID,
       a.locID,
       DATEADD(mm,N,@date1) AS OperatingDate
FROM   dataset A
CROSS JOIN Months m
WHERE  A.startDate >= @date1
       AND (A.endDate <= @date1 OR a.endDate IS NULL)
       AND A.condition <> 1