Converting the ride into an partial dark ride would do wonders for it! I would think the theme would better suit traversing through the woods after dark, or maybe the sawmill idea posed above (or both ).
There is also the option to build a second, more modern Log Ride and incorporating those ideas into that. And it is not that far fetched of an idea for HW to have a second log ride. It could be placed somewhere where you could queue for it from both the dry park and the water park, similar to how PP was done.
It would be great if HW got a more modern log flume.