As far as signaling goes. There is an ongoing project to improve signaling throughout the subway. This is why the L train is not running on weekends. Once the new signaling is in on that line trains can be spaced closer together. This is all I am saying about the A/C brooklyn tunnel signaling. Make sense?
The signaling on the L line is an isolated case, and was done because the L line has no way to easily expand service other than spacing trains closer using computer based signaling.
This has been a very major change as anyone who has ridden the line with any regularity over the past 10 years has seen, new signals, tons of track work, electronic boards that display when the next train will arrive, and of course replacing the entire rolling stock on the line. This was all done due to overwhelming increases in ridership that absolutely warranted the expenditure.
This is how changes/expansion to the subway system works. There needs to be an existing demand for a service change in order for it to happen, and at the moment there are plenty of other projects that this money could go to (2nd avenue subway sticking out most prominently in my mind). Sending the money to a wish-list G train extension to Manhattan to benefit a line that cannot even fill a full length train would be insulting to those people who suffer due to extremely poor or non-existant service. Especially since the G train riders can simply wait for a train across the platform to take them where this extension would.
In addition, NYCT has made it very obvious that it does not place a priority on weekend service, as can be seen every weekend as they do maintenance, even on the G line, where it has been running in two sections pretty regularly. How would this service benefit G train riders in that situation, if they had to wait for 2 G trains anyway? Even off periods on weekdays are not a priority, the priority is always rush hour so this makes a service meant to benefit off hours extremely unlikely.
I will admit, that in a perfect world, this service would benefit some people. However, unless there were a massive influx of people to the area surrounding the southern end of the G line who worked far south of 14th street this group would be very small in comparison to the ridership of most other lines.
The idea does make sense and if the two lines could be connected easily (which still seems dubious) it would be a fairly logical situation in theory.
However, considering the real world factors of practicality and limited money, in addition to a large amount of potential projects which would benefit more people, it is simply not something that NYCT should bother with anytime in the next 50 years given the current state of the subway system.