You'd have to tie it in neatly. Kirkby didn't need it, the trains to town were always great and we had the buses as well.
Where I live now doesn't have a tram route as we've great bus and rail connections to Manchester. However, the areas like Eccles, Ashton, Wythenshawe etc that would benefit have them. So in Liverpool, places like Croxteth, Norris Green, Walton and Anfield, that don't have easy access to the Merseyrail network would benefit
This is true. I think the issue in Liverpool is one of capacity. Kirkby has a good rail link, but if the trains and stations can't handle the footfall then passengers need alternative means of getting into work and back. And although there's good bus links, roads come with their own problems, especially when the council decides to dig up major arteries like the Strand.
When it came to the Kirkby tram, I think the idea was to just get the system up and running, which would enable expansion further down the line. So they picked an easy destination that they thought was achievable. Let's not forget, it was a Labour government that pulled the plug on funding, and we're talking (relatively) trivial amounts of money here.
As a pedestrian, I've often seen the council's transport policy as somewhat schizophrenic. They used bus lanes to encourage public transport take-up, but when drivers didn't take them up they abandoned them rather than play hard ball on motorists. I don't drive, so there's probably a whole subset of reasons why that's the case, but if you're going to allow cars into the city centre at the same time you are pedestrianising and/or narrowing roads, then the math is simple - more cars + fewer roads = congestion, pollution and poor air quality.
Just as an example: Making the Strand pretty to walk through is great, but it doesn't help solve transport issues. A mixed use, raised, urban motorway/tram line through the Strand would be expensive, but could be built in sections with minimal disruption to existing traffic (if you can demolish flyovers you can build them too). Plus, there are tons of disused rail lines that could be partially repurposed, either as tramlines, as you say, to link areas of the city with poor connections, or hell turn them into roads for HGVs and buses to ease congestion.