I will concede I am not certain about the modal share for MSG event goers; I thought I remembered where my source was but I have not been able to find it. The bottom line is that, on the Penn Station superblock, the allocation of space among the 20,000 fans MSG can accommodate at any one time and the 300,000 daily users of the station is upside down. Stadia are relatively inefficient users of urban space to begin with, much less urban space as centrally located and valuable as the site of the Western Hemisphere's busiest rail hub. Getting MSG off the site greatly simplifies the task of redoing the area to serve the travelers first. For the future MSG, I think that Citi Field strikes a good balance between transit access (whereas the Coliseum has none) and the need to bring in team/performer buses and trucks--which don't play that nicely with Midtown streets--expediently. As for what other uses may replace MSG, there is a glut of retail and office space, and housing is probably inappropriate for the site. Which makes it all the better, as the site could be exclusively a public commons (I would think some kind of air rights transfer could be worked out to make sure the developers come out ahead).
Don't get me wrong, I get that MSG's current location matters to management and to event goers. If there is a way to combine an airy, ample, functional train hall occupying a majority of the space--and rising above ground level to boot--with a new stadium occupying a minority (Mr. Nasadowsk proposed this early in this thread) I am for it. Repurposing the MSG theater leaving the current arena intact does not cut the mustard. The Chakrabarti plan to convert the MSG superstructure to a train hall does not cut the mustard. Both plans would leave the eastern concourse and platform area underneath Two Penn, where the most severe congestion is, deprived of light and space. "Cleanrooming" the site is what is called for. Most people at the site are rail and/or subway passengers, and their well-being must come first.