AIUI the logic of keeping the through service was based on the GLA and TFL's own planning in 2 respects. The first was that Sutton residents were being charged the Crossrail Precept and then told they, who would probably never benefit from Crossrail would would loose cross London services.
The second was that GLA/TFL stategic planning included Crossrail, Crossrail 2, the East London Line and acknowledged ThamesLink. An analysis of London Boroughs indicated that the opportunity to access jobs across London and for employers to recruit from across London improved the overall economy.
A review of services south of the Thames indicated that every Borough would have access to cross-London services including CrossRail, CrossRail2, East London, North London, West London, District, Metropolitan, Northern, Central and the other underground lines. Essentially Sutton would be the only borough to loose cross
London services.
I would support 4 trains per hour and not that the slow west side of the loop means that at every station north of Streatham it looks like 4 trains per hour and with zonal fares passengers could go either way round. I also note that even Nation Rail doesn't show a direct train from West Sutton to Hackbridge but everyone knows its the same train.
It seems to me there are 3 options for the west side of the loop to get 4tph.
1) One could extend the either the Sutton terminators or East London Line service to Wimbledon
2) Run all TL trains via Hackbridge and back to Blackfriars and
3) Add the extra 2 trains south of Blackfriars in the gap on the same loop service but avoiding conflict at Blackfriars
Options 2 and 3 mean that passengers on the west side would only have a 7.5minute wait on any platform to continue there journey if on a Blackfriars terminator
Whatever is done the stations on the west side need proper level access.
I hope