While the XC services on either side offer me better connections at the Birmingham end, I usually try to get this one as you don't get crammed in like sardines!
I've always thought that running services along these lines would be better:
Virgin:
2tph Euston - Birmingham
1tph Euston - Crewe - Manchester (direct)
1tph Euston - Stoke - Manchester (direct)
1tph Euston - Birmingham - Wolves - Stoke - Manchester
Crosscountry:
1tph South East - Birmingham - Crewe - Liverpool (Replacing one of the London Midland Liverpool services)
1tph South West - Birmingham - Stoke - Manchester
London Midland:
1tph Birmingham - Liverpool
1tph Birmingham - Manchester (stopper)
It maintains current frequencies (though Manchester loses 1 fast train from Euston, but I don't think that'd be a *massive* loss), while allowing extra through trains.
Losing a direct Manchester - South East train I don't feel would be that much of an inconvenience, it never seems like there are too many people travelling beyond Birmingham (nowhere near as many as stay on for the south west services).
It would free up units for Virgin and LM to use elsewhere, perhaps LM would then be able to run that Birmingham - Manchester stopper that keeps getting talked about.