Why did the builders of the Erie canal spend so much effort digging west through New York State when they could have diverted north to Oswego, used Lake Ontario to go west, and used a much shorter canal near Buffalo to scale Niagara Falls?
Multiple reasons.
Canal boats do not fare well on open water. Lake Ontario is large enough to act like an ocean. It has waves, rough water and does not have a consistent coatline like the canal did. A consistent coast/shore is important when your boat is pulled by mules. A canal boat can't be pulled by mules on the open lake, and tranafering cargo to a boat capable of lake travel is added time and expense.
The canal provided access to the western half of the state, by connecting to NYs central Finger Lakes. This area was valuable due to its timber industry in the early 1800s. Diverting the canal to Oswego would have cut off access to this valuable resource.
Overall, connecting to the lake at Oswego would have reduced the usefullness of the canal, made shipping goods more complex, and would have left the towns of western NY without reliable transportstion.
The Oswego Canal actually opened 3 years after the Erie Canal.
But you got to remember that these were barge canals at the time (they would be expanded later for small boats).
Since they were barge canals this meant loading and offloading onto larger ships at Buffalo and Oswego.
Fun Fact: Plans were in the works for the All American Canal which would take such a path to directly connect Lake Erie with Ontario and to compete with the greatly expanded Welland Canal and St Lawrence Seaway in the 50s and 60s.
However, with the interstate system, shipping freight by truck became much more effective, cutting into the projected shipping traffic. Ultimately the project was cancelled.
/r/buffalo