Dufferin seems like the better OL alignment to me, too, in terms of a distinct role for metro versus RR. Would probably spur greater nework effects than Roncesvales due to greater catchment area, density and attractions further east. Hell, if King-Libery is dead, Dufferin-Queen would be a more useful location for a GO-OL interchange with Kitchener/Barrie. But the further north of Bloor you go, the more maybe OL duplicates an EMU-powered Barrie line at much greater cost.
With (relatively) good connectivity between Line 2 and Kitchener coming, I wonder if the best OL extension option is straight westward, stopping at Jameson and Humber Bay before bringing rapid transit elevated along the Queensway to an area that's going to see a lot of residential density