Seeing as he had already beaten the Danishmends and taken Konya, and had a bigger army than the either one of the other two major participants in the crusade, if Frederick successfully made it to the Holy Land, the situation would be very different. As Emperor, he outranked Richard and Philip, so he could have taken charge of the crusade and kept both French and English armies together. I would say that the chances of re-taking Jerusalem would be alot better, not certain but much, much better. We might see a different king of Jerusalem rather than Guy. Guy's succession was illegitimate, breaking Baldwin's will, Conrad of Montferat would get a better chance of becoming king, seeing as he was related to Frederick and had a good military record, as well as being fairly popular with the locals, he might not get killed by assassins in TTL. In general terms, the land route through Asia Minor would not be regarded as impassable and thus the Crusaders would have less incentive to buy passage by boat, the Italian merchant republics would be weakened, not by a whole lot, but some, they probably wouldnt get the same dominant position in the KoJ as OTL, seeing as the king would have more than the coast. The 4th crusade might not hit Constantinople, but someone from the West will and probably while on crusade, the Byzantines have a bad history with Crusaders, seen as if not traitors, definitely not good neighbors, Frederick had to occupy several cities on his way through and the emperor Isaac was allied to Saladin.