I had a wild idea a few months ago about this also. I proposed converting the Flushing line to B standards, and running service like you stated, through the 60th Street tunnel.
Close the section from Queensboro Plaza to Times Sq completely. This will require the most effort to convert, especially the river tubes, but won't adversly affect service in Queens.
This is where my idea would come into play. giving the Flushing line more capacity, and the Crosstown line a ride to Manhattan. After conecting the 7 line to the 60th Street tunnel at QP, how about connecting the G Crosstown line to the Steinway Tubes between Vernon and Hunter's Point Ave. The Crosstown Line would then run IRT sized trains, but will be connected to Manhattan. This new line would run between Times Square and Bergen Street Lower Level.
A new station would be built at current junction of the 7 and G line. This new station would connect to the current 7 line Hunters Point station, and a connection between Court House Square and Ely Ave would be made. The section of the 7 between Queens Plaza (at a new platform added) and Hunterspoint Ave would become a shuttle. The current G line between Van Alst and Queens Plaza would be abandoned to passenger (but the track kept open for non revenue moves). Van Alst and Court Square would be abandoned. Van Alst is one of the least used stations in the system anyway, and Court Square won't be necessary either with the G running to Manhattan, and the new connection between the new "shuttle" at Court House Square and Ely Ave.
So in summary we would have:
-A new numbered IRT sized train route (let's say 11 to avoid confusion). The "11" would run between a converted Bergen Street Lower level and Times Square, via the fromer G route. This would prevent express service in Park Slope, but it's running just fine without it anyway. I believe the asset of having direct Manhattan service for the former G line outweighs skipping 3 stations in Brooklyn.
-A new lettered BMT sized train route (let's say "T" for argument's sake). This "T" train would run between Main Street Flushing, and Whitehall Street via the former 7 route in Queens.
-A new "S" between a new LIC-Sunnyside station in Queens, and Queens Plaza via the fragmented portion of the former 7 line.