Longitudinal seating works much better during crush hour since you get far more standing room in the middle of the train and better movement. I think it offers more capacity, but it definitely offers better flow of people! I prefer it, as someone who stands just about any time I take the TTC (unless it's a bus). Giving REM perimeter seating might seem a bit odd since it's a commuter-metro hybrid of sorts, but I guess they must be expecting really high ridership.
I wish we had longitudinal seating on the new LRT trains that were built for Line 5/6, since the trains are narrow and have the same chokepoints as the streetcars. But I realize that's probably difficult to do since a low-floor train will have these chokepoints anyways because the bogies eat up floor space inside.