The issues with services running via or avoiding the City Loop are basically the same for any service group. Some passengers will be disadvantaged and a smaller number significantly so.
It is claimed that Flinders Street remains the busiest station in peak hours overall. By number of entry and exit validations I'm not so sure based upon the numbers I see going through Parliament in particular.
The argument for the Frankston expresses to run via the loop is that this retains the time saving of those services and they remain the most attractive option for longer distance users. Where the rail portion of the journey is already around an hour a saving of 10 minutes or so is worthwhile. That has been one of the reasons those trains are extremely heavily loaded.
To remove them and force users to change, or to use stopping trains, removes any benefit of an express service for most users. The additional time involved is between 5 and 20 minutes depending upon actual journey and alternatives used and would typically be 10 minutes if a stopping train were used.
That makes the stopping trains the best option and will shift the load from the expresses onto those farther out. They then arrive at somewhere like Cheltenham already filed to capacity and are unable to take passengers from those very stations in the inner suburbs that they are intended to serve. Meanwhile the expresses become lesser used and present Metro with an excuse to then cancel them altogether in favour of more all-stations trains.
The half-respectable peak service for passengers travelling over 40kms in many cases would then be lost and the Frankston (or indeed Pakenham if the same were to happen there) line be turned into a slow painful and much less attractive service which will drive some users back to the roads.
There isn't space for all the trains now in the timetable to operate via the City Loop.
The best accommodation would be to have as many of each stopping pattern as possible to run that way and those which cannot be fitted in to go direct. Failing that it should be the expresses, not the stoppers, which take passengers to where they wish to go.