Have you considered upgrading the 6510 adapter PCB so you can just plug the wires from the RAM upgrade into it? It'd be a lot cleaner and not a great deal of work to add two additional traces and thruholes. Plus you could avoid soldering on the original PCB, and it would be 100 percent reversible. That being said, it's a very slick and clean upgrade!
You only need the "Diag Cartridge" if your Commodore 16 starts acting strange after performing the 64k RAM upgrade. I upgraded my C16 a few months ago and added 16k to 64k "Flick Switch" as some C16 games will not run in 64k mode ( Rockman being one of these games ), added heatsinks to the TED and CPU chips and my computer is still running perfect.
I purchased mine from AliExpress a while ago; eBay is a good source too. I also read on the Facebook C16 and Plus/4 group that Jameco Electronics in the US is a good place to look too.
Your mod is quite interesting, but honestly I don't think it worths the effort. The "destructive" mod isn't so destructive: only need 1 cut in the board OR one pin lifting (U8, pin #14).... but you don't need to remove the two multiplexers, so it's really easier and less risky. Then you solder the same two wires behind the board, in order to have a cleaner aspect of the component side, and you've done (of course you need to replace the ram chip). Faster and cleaner IMO.
You only need the "Diag Cartridge" if your Commodore 16 starts acting strange after performing the 64k RAM upgrade. I upgraded my C16 a few months ago and added 16k to 64k "Flick Switch" as some C16 games will not run in 64k mode ( Rockman being one of these games ), added heatsinks to the TED and CPU chips and my computer is still running perfect.