change at Lavistown Junction
 

Just a thought. Would it be possible to reduce journey time to Waterford by having an interchange at Lavistown junction similar to Manulla junction and rail car to Kilkenny

Yes, it would be possible. But (a) you would save max 10 minutes to Waterford offset by an extra five minutes plus the inconvenience of a train change for Kilkenny (b) the cost of the necessary works at Lavistown might be better spent somewhere else for service improvements (c) The cost of having an extra train stabled at Kilkenny, plus extra crews would be significant

So for these reasons alone the idea would be a non-runner on a cost-benefit basis. The comparison with Manulla is misplaced: compare distances Lavistown-Kilkenny with Manulla-Ballina.

Princeton Dinky in New Jersey is bonkers enough without importing the concept!
https://youtu.be/QOF9gpZmD0U