I agree that limiting the scope of Sheppard would be desirable, but I came to the opposite conclusion about which segment is the most palatable. The DRL is precisely the reason I prefer the western extension. Since the DRL will most likely go up Don Mills, the current Sheppard terminus is ideally situated where it could serve as an interchange between the DRL as well as the transfer point between Sheppard buses and the subway. This arrangement gives people an incentive to stay off the Yonge line because taking the DRL won't add an extra transfer: at Don Mills, they would have to transfer anyway.
The other reasons for preferring the western extension are basically the ones that have already been stated numerous times: easy yard access, no extra load on the Yonge line, greater impact in reducing transfers, etc.