I don't think the UCP would have had a problem with the design of Valley Line since it isn't terrible like the planned Green Line was. Attempting to use LRVs in a subway setting is ridiculous. If you're tunneling already, the capacity should be very high.
Edmonton has the advantage of having a very future proof subway, so running a grade level LRV system downtown is ideal for a host of reasons. Once you get out of central Edmonton, the trade-offs start to be more obvious, but the big issues have been mostly solved by grade separation at 170th/178th/West Ed.
I believe Edmonton will run into commuter/event capacity issues on the Valley Line West at some point, though. However, the quality of life improvements for central residents will probably outweigh the downsides, and running high floor on this VLW alignment would have been difficult or impossible.