Ironically, what the new model for the Overlander reflects is really just a copy of something done successfully in Australia (like most good things in NZ!) with the current operations of its namesake
The Overland between Adelaide and Melbourne. This operates during the day, three times each way each week. Being a tourist-focused train operating on a single-track network (which is of national importance exclusively for the freight carried) means that they know in advance how many passengers will be travelling and the consist length can be adjusted accordingly.
Cutting the number of trains is a far more preferable option than cutting the service altogether.
I am sure some of the intermediate stops on the route that are being cut will miss it. Seems strange as if it's a primarily tourist railway then the end to end time surely can't matter so much?
The intermediate stops being cut would not be because of improving the end to end time, that's not something that would be a factor on what they are trying to recreate as a premium tourist service like the Great Southern Rail trains in Australia.
It would be because those stops are very poorly used and cost each train more to stop/start (in fuel and general wear & tear) than the revenue earned from those stops. There is also the issue of whether the passenger train stopping too many times is getting in the way of freight trains, perhaps it could be that the stops needed to be cut in order to avoid The Overlander needing to wait at stations/loops for freight train/s to overtake.
It's a similar situation with the Great Southern Rail interstate trains in Australia on the Adelaide-Melbourne, Adelaide-Darwin and Sydney-Adelaide-Perth trips. Their online advertising only mentions the major stations, with the intermediate stops being treated as request stops which must be booked in advance and the time being given with a ±30 minute margin. I'm informed by a friend who lives in Bordertown that they've only seen The Overland stop there a couple of times in three years of living there!