Why couldn’t the Oxford Road terminators go to a Longsight turnback? You can access more of the centre of Manchester that way, with no conflicting movement on departure across the lines at Oxford Road going back towards Liverpool
Piccadilly platforms 13 and 14 are some distance from the centre of Manchester; Oxford Road station is far more convenient, so extending stopping services from the CLC line east of Oxford Road is not particularly useful.
I don't see the purpose of turning services at Longsight. Surely the only claimed justification of running longer distance services via the Castlefield line (other than to Sheffield) is to go to Ringway Airport. If they are going to terminate at Piccadilly (and turn back at Longsight), they might as well be diverted to Victoria, as the main problems are on the Castlefield line itself.
I do not understand why Network Rail can't
ban long-distance TOCs (TPE/TfW/EMR) from using the Castlefield corridor; this would solve the problems at a stroke. Northern Rail could run 1 semi-fast tph from Lime Street via the CLC line and Stockport to Sheffield to preserve a connection between Merseyside and South Yorkshire as there is no realistic alternative route, but otherwise the Castlefield line should be used solely from a passenger angle for local/regional services only.