So what would the best Navy have been for the Norwegians needs in the run up to WW2
Yep a true Littoral Navy backed by modernised forts (guns/mines/torpedos)Mines and MTB's!
The mines are laid to force enemy ships close to land where the small and cheap MTB's can swamp them with numbers (preferably in the hours of darkness. A few more subs would help.
To really do a Norway wank add a couple of squadrons of old biplane torpedo bombers and base then far enough north to escape surprise air attack.
The Norwegian navy was a small organisation in terms of budget and manpower - the 2 Coastal defense ships only had a crew of 270 and those crew are far better used spread aboutBattleships with big guns give the locals more confidence than some MTB. In holding ports, batteries defending minefields will be more reliable than MTB. Submarines add that level of doubt for an attacker but are expensive. MTB are what you can acquire in a war warning period rather than a long term capability. Battleships need not be fully manned and as a training tool and port guard ship can provide a depth of reservists to build on.