I broadly agree with you Luke - though it must be said, back in 1996, I think the feeling was that 25 000 capacity grounds would do for clubs like us ..... Wolves for instance, wholly rebuilt Molineux to that capacity ..... they were pessimistic times.
I also think that one of the problems with building the South Stand higher is that you tend towards the unbalanced sort of stadium that for instance Elland Road has become .... one dominant 2 tier stand and if you are sitting in it, all you can see of the rest of the ground is the tops of the rooves of the other sides, you don't feel part of the crowd .... I've experienced this at Old Trafford.
I think it might be smarter to enlarge the John St. first but because it is a recently constructed stand, there is possibly a reluctance to want to do this.
I'm absolutely sure btw. that the South Stand was built so far away from the pitch to allow for a twin stand to be built on the John St. side of a pitch shifted southwards ... but sensible masterplans are nearly always forgot in the name of short term exingency, it is PRE Kevin McCabe and the John Street stand was a cheap design and build job, I believe everyone knew it could have been better designed but a contract had been signed (by the previous owners) and that contract was honoured.