I would SO rather see kids walking around playing with hoops than bouncing basketballs.
As for the characters/shows for KidsFest...
Really, I'd be more than happy having only VeggieTales there. Sure, it isn't 1880s (although they could easily create a VeggieTales show that is set as a western, like some of their adorable Old West-themed bible stories), but at least they are known for their good educational value. Spongebob... ugh. No. Just... no.
From the list on their site of characters that will be visiting the park this year--
VeggieTales ; The Flintstones; Dexter & Dee Dee; Dora & Diego; Powerpuff Girls; Shaggy & Scooby Doo; Tom & Jerry; The Jetsons; SpongeBob & Patrick; Backyardigans
--just keep Veggietales and possibly Backyardigans and Dora & Diego. Backyardigans is pretty good and they could easily be costumed to fit the 1880s; same with Dora & Diego. Flintstones, Powerpuff Girls, and Dexter & Dee Dee just make me go, "HUH?" (btw, is Dexter's Laboratory even still on the air? Do kids these days even watch it anymore?) The rest, too, just don't fit (though one could try to fit Scooby and Tom & Jerry into the western theme).
So, yeah. I understand that SDC doesn't have its own animation house to draw on like Disney does for walk-around characters. But if they got more street characters out and about, they could easily become recognizable, like Whoops E. Daisy and Deputy Birdy Tweedle, like the Undertaker and (if only they'd bring him back) the Rainmaker. Bring Rube Dugan and his gang back. I don't know that I ever got to see Rube himself, but I do remember when Geyser Gulch was new seeing characters walking around the area and interacting with the kids.
Get Tom, Huck, and Becky, as well as Mark Twain, for Tom Sawyer's Landing. Have Doc Harris out more at Wildfire. Get a couple all-American daredevils for American Plunge. There are so many opportunities for characters in more areas of the park than just at the front gate and Main Street.
And now I think I've rambled to the point of going off-topic... maybe. To bring myself around, I don't think there should be a need for a "portal" because they need to just think outside the box more in order to come up with activities, shows, and characters that will still follow the theme.
As for World Fest... meh, that's never really grated on me like KidsFest has increasingly come to do. Most of the World Fest shows are all about tradition and folklore, so I imagine what they do in their shows now probably aren't all that different from what it'd look like in the 1880s.
~"Becky" Joy~
PS: Moonlight Madness -- great idea, HORRIBLE playlist. I don't wanna walk around SDC listening to golden oldies! That's what the radio in the car is for. If you want upbeat, modern music, at the very least just put stuff like Carrie Underwood, Shania Twain, Rascal Flatts, etc on the playlist.