The 1956 election was unwinnable for Venizelos: the so-called "three-phase" electoral system had been designed by Karamanlis so that he would win, even though the opposition under Venizelos got more votes.
Leaving that aside, it is hard to say... The younger Venizelos was not exactly a strong leader, and his party was a coalition. So his government would probably be a week government, and any attempts to liberalize the politics of the country would probably tun into strong opposition by the entrenched right-wing establishment as quickly as had happened in 1950-52 (the "Centrist Interlude"), or as happened in 1964-65 with George Papandreou. To have a real chance for internal changes one would have to make the Centrist Interlude last longer and be more effective at rehabilitating the Left and promoting national reconciliation. After Papagos' government, it was too late. That is not to say that the Colonels were inevitable; that Papadopoulos was scheming was a common secret, and he and his cohorts could easily have been thwarted before 1967 if there had been the will to do so. A dictatorship of any sort was not really likely until the Apostasia in 1965, which definitely divided society and pitted the palace and the right-wing deep state against the Centre and Left (and hence against the majority of Greek society).
Likewise with Cyprus: by 1956, EOKA was already fighting the British, and any Greek government would be forced to support them. The difference is that in 1960 Karamanlis was strong enough to agree to the Zurich accords, which gave the Turkish Cypriots disproportionate power (from the Greek perspective) whereas an unstable coalition under Venizelos (provided it had lasted that long in power) might not, and opt for a more maximalist stance (much as Papandreou refused to accept US proposals to resolve the Cyprus issue later that were rather favourable to Greece, certainly much more than the post-1974 status quo). It is anyone's guess as to how this might have played out.