Personally, I always liked travel times as they are, since they convey a sense of distance rarely experienced anywhere else anymore, including real life. There is something archaic about having to wait days to get anywhere, which can feel strangely rewarding in itself. As a player who came to like the game, while it still had to offer something besides roleplay (that is, exploration, survival and a building system that wasn't rendered near-meaningless by an overabundance of practically everything), I might not represent the average player of today though.
That said, I doubt that road length has any direct connection to the shrinking of the playerbase, simply by virtue of not having changed much over the last decade. (If anything, travel times have decreased on average, due to the greater availability of vehicles.) The fundamental problem as I see it, is that the game's target audience narrowed down to much over the course of the years. While shortening travel time might help retaining some people in the remaining segment of players, I highly doubt it will return player numbers to old glory.
(Actually, I'm not that convinced about the increase in player retention anyway. 50 Players not quitting because of road length, doesn't automatically mean 50 new players. People who are turned off by this kind of thing, might as well not like other slow-paced aspects of the game and quit for a different reason later.)
In short, I doubt this suggestion will have the desired effect.
Pretty in pink.