You're living in an alternative universe where nothing costs money. My musings were on the border of that universe. Yes, if money were no object SMART should be electric. Whether it should be separate from freight is a different question, and having lived in that area I would lean toward NOT because there is not enough freight traffic to justify a separate line. There are also a lot of places along the line where there isn't enough space for an ultimate layout of 3+ tracks (2 SMART, 1 freight + sidings). There's no physical reason why electric MUs can't be combined with freight - they do it all the time Back East, and Caltrain is going there. And here we must agree to disagree: freight service to the area needs to be maintained.

SMART was conceived as a commuter line, and with only occasional (not frequent bi-directional) service at startup diesel makes sense. Also, money IS an object, so the up-front cost is important. Should the ridership develop as I think it will, they will probably need to look at going electric (and adding sidings/second track) much sooner, relative to the life of the system, than Caltrain. Either that, or GGT shouldn't throw away its highway buses - they will be needed again fairly soon when SMART runs out of capacity.