Why lengthening Nagato would expose the scale of a rebuild

Could Nagato gain machinery space by inserting a new hull section amidships?

Physically yes, but the visible increase in hull size and displacement would undermine claims that the rebuild stayed within treaty limits.

Lengthening the hull could create room for additional machinery, but it would make the increase in displacement conspicuous. The discussion gives Nagato's declared standard displacement at the Washington conference as 32,720 tons and contrasts it with roughly 39,000 tons in 1944. A new central hull section would add still more weight. Removing a turret offers a less conspicuous way to find machinery space within an ostensibly limited modernization.