I don't see it making much difference - the inner end is predominantly shared with the relatively high frequency Bakerloo, and I'd imagine the outer end mostly serves peak hour commuter traffic which is unlikely to see much growth simply because you've added an extra train per hour.
Mixed issues here, IMHO. Being a former user of said services, given the long journey times into London the outer stations are generally quieter as you have the AC services which are much, much faster. The 20 minute timetable was the killer though, as it would often work out quicker to get off at Harrow and catch a bus than change to LO to get to my nearest station (I used to live in Bushey, so a 30ish minute bus ride from Harrow station and a 10ish minute bus ride from Bushey station). Especially if you just missed one because somehow the AC service was late having somehow lost time before even reaching its first stop out of Euston.:roll:
I wonder if you improved the capacity and the quality of the interchange at Harrow would you be able to remove all the AC stops at Bushey to increase capacity? ...or at least permit doubling back via Watford Junction.
I do think you could get away with cutting the Bakerloo back to Queens Park to mitigate the state of the rolling stock if you increased the LO levels though, and later perhaps diverting the Bakerloo (i.e. via OOC or some such) as part of a larger project when the stock finally gets replaced.
I'm a firm supporter of a reinstated Primrose Hill/Chalk Farm station linked to the Northern line to maintain links to Euston, and even if it was just to a bay at Camden Road, I think that would be a good option for LO. My ideal services are Richmond to Barking Riverside, Clapham to Stratford, Watford to New Cross, Harrow to Crystal Palace, Willesden to West Croydon and Dalston to Clapham though, with AC calls restored at Willesden. As always though, the question is that freight...
...a new tunnel from Gospel Oak to the Midland freight lines at West Hampstead would let more (if not all) go via the Goblin though, and even better if you built a station on it at Belsize Park linked to the Northern Line station.