Apparently it was a later war design
Yes it was. Garand knew better, so he never really tried to develop anything like it, but was more or less cajoled into trying later in the war. It failed, as he knew it would, because the .30-06 is so powerful. But with the PD42 .276 round he might be tempted to try something like it a bit earlier- and it probably
would work. Certainly, Ordnance might be willing to
not specify "based on the .32 rimless self-loading cartridge" in their request for carbines to evaluate, to see if a Garand folding-stocked carbine might fit the bill. And if they did so, I bet Garand would bash something like the M1E5 together for the trials.
A 7mm M1 Carbine however would be very interesting. Chop the standard Pedersen round down to 40mm length with a 7mm standard bullet and combined it with the shorter barrel/folding stock and you'd have a winner IMHO. Now just add in an automatic feature and pistol grip and get an assault rifle...
I could make up all sorts of de novo stuff that might make the M1 Carbine more interesting, but I'm trying to minimize just making crap up. For the same reason the 6.5mm Mannlicher would be my choice for a *FG42, unless I could find some VERY good data about those experimental Luftwaffe 7mm rounds you mentioned.
Where I'm going to run into trouble is Vietnam-era developments. Because there was so much weird shit floating around and being tried, and it's hard not to unleash the butterflies in that environment.
6.8mm Remington SPC, which fires typical 7mm (.277") bullets, also around 120 grains, has a similar problem, which is why it doesn't present much improvement over 5.56x45mm NATO at long ranges. Light bullets at these calibers can gain velocity but will lose sectional density, so there is definitely a tradeoff.
Yeah, I'm critical of 6.8mmSPC, too. But the fanbois (read: 5.56mm-hater mafia) can be hard to convince. 6.5mm Grendel is much more interesting. But it's pretty much impossible to get anything
truly interesting to fit through the magazine well of an M16.
I suppose then there is the historical option: adopt the historical carbine and cartridge, but neck it down to 7mm instead of 7.62. Johnson was able to get a 5.7mm projectile to work in it:
Yeah, we had a really long discussion about .22 Spitfire on
another forum post here. It probably would be more interesting than .30 Carbine, but what it
most definitely would
not be is a *5.56mm. It had significantly less case volume and would never be able to generate the muzzle velocities needed to replicate the tumble-and-fragment mechanism that made the 55-grain 5.56mm so deadly. It would be much more like a *5.7x28mm than a *5.56mm.
So, it just pokes holes in things. Like the .30 Carbine, or a handgun. So, more interesting yes, but not really a great improvement.