If this service was curtailed as suggested and did not go to Sheffield then this would have the effect of moving people onto either XC or the direct services on this route. In either case this would just lead to more overcrowding on these trains.
The journey times from the stations denied a direct service would of course be increased due to the need to change. The present service seems to be well used and copes well but like most services in the Northern area could do with longer trains at peak times.
There's a half hourly Leeds - Kirkgate - Barnsley - Sheffield service operated by Northern - this overtakes the "via Castleford" service en route - for example the 10:32 slow from Leeds gets to Normanton at 10:57 but the 10:38 semi-fast has already passed Normanton at speed at 10:49.
Nobody using the "via Castleford" service is going to swap onto the XC service (which runs a different route between Leeds and Meadowhall and doesn't serve any of the same intermediate stops) - the hourly XC service overtakes one of the two semi-fast Northern services (as well as overtaking the Dearne Valley stopper between Leeds and Sheffield too). The small number of people doing Castleford/ Normanton to Sheffield would just change at Kirkgate.
However the fact that the Castleford section means around fifteen minutes penalty for anyone doing a journey like Leeds - Kirkgate/ Barnsley (compared to the semi-fast) shows how unattractive that service is for any medium/longer distance passengers. Hence the suggestion that it's either diverted away from Castleford or cut somewhere further south.
If the Northern Connect service through Westgate ever happens (?), it might be time to just accept that the semi-fast isn't much use for long distance passengers and insert stops at Darton/ Normanton (and use the current Leeds - Castleford path for a service that extends to Pontefract/ Knottingly instead).
The fifteen minute penalty just to serve Castleford is a waste of resources (given that Castleford has another service to Wakefield - the Huddersfield service) and dates back to the days when BR tried to stretch their resources to provide a service that ticked as many boxes as possible but without being of much use for longer distance passengers.