A continuous rapid transit line across the north of the city is desirable.
But I can't imagine the city council or Metrolinx agreeing to spend $760 million to convert Sheppard subway to LRT. Note that this is the cost of about 1000 new buses, or 150 new streetcars (practically, the second streetcar fleet).
IMO, there are two options for building the northern crosstown route.
Option 1: if Scarborough accepts Sheppard East LRT, then let it be; but consider increasing the stop spacing east of McCowan to make it run faster.
In a more distant future (20+ years?), convert Sheppard subway to mini-metro, and extend westward to Pearson. That will create a crosstown route; with a minor nuisance of transfer at Don Mills, but running reasonably fast.
I sketched a picture of such route (below), together with subway interchanges and Finch LRT.
Option 2: if Scarborough rejects Sheppard East LRT, then nothing gets built there in the short term. Eventually, the whole Sheppard - Wilson line may be implemented as mini-metro; but I would not expect it to start sooner than in 20+ years.
One can ask: why bother converting Sheppard subway to mini-metro? Mini-metro is probably not much cheaper than TTC subway if the line is straight, or can make smooth turns.
However, mini-metro should be able to handle much sharper turns than a full-fledged subway, as well as fit into tighter corridors. That might permit cheaper routing choices. At the same time, converting the existing subway tunnel to high-floor mini-metro should be many times cheaper than converting it to low-floor LRT.