Getting a railway across the M5 ought to be fairly straightforward. Getting through the dozens of streets of houses either side of Southern Way would be much more of a challenge... unless you had a tunnelling machine, in which case suddenly it looks almost trivial; 1km of tunnel would get you under the Kenn and far enough to pop out somewhere near the Rugby Club; before you knew it you'd be at Station Road. It's do-able, with a modicum of political will.
Indeed the M5 is not an insurmountable barrier, particularly if the light rail option is taken. Manchester Metrolink's route to the airport was blocked by the M56, much the same width as the M5 at Clevedon. A bridge was chosen, which you will see on Google maps alongside the Hollyhedge Road bridge.
If you followed that route as far as the Tesco on Kenn Road and turned to the west, then at the cost of an industrial unit you could find your way back to the old alignment. I estimate 7 houses would need to come down to get you from there to the old station site... I concede that that would probably be cheaper than tunnelling through a peat bog.
Again, Metrolink have proven the method. Five or six houses were bought by Metrolink before the Oldham extension began. So long before, in fact, that they were let to the city council to house homeless families for a few years, until the need for demolition became imminent. In Oldham town centre itself, the first work on the project to build a brand new line through the town, rather than the former heavy rail route between Werneth and Mumps, was to build a Baptist church and a funeral parlour to enable demolition of the existing structures. Neither organisation minded, as the new buildings were built to current standards and were better than the old ones. The cost wasn't enormous, certainly cheaper than tunnelling.
