Cork was at Knock's level of traffic in the early 1990's and it's 4 passenger stands were inadequate to cope with demand. Aer Rianta then put in two extra stands which proved sufficient untill it exceeded the million mark in 1996. I'd say there's a very strong business case for at least 2 extra stands at Knock providing it can hold this years' traffic levels although that could be a big ask if the economy stagnates further.
Interesting comparison, one big change since 90s is the pressure of 25min turnarounds adding to the need for free stands. From what I read it seems several issues have delayed the overdue extension:
Firstly planning. Objections delayed the first phase of the infrastructure master-plan, and by the time they were overruled by ABP the capital funding had been withdrawn.
The airport is now subject to a Local Area Plan. An area of raised ground (which is needed as infill for the apron extension) may be of issue. With the airport in the process of being designated SDZ, it may be cheaper to wait, though that isn't guaranteed either.
Secondly topography. The land required is currently occupied as staff parking and car-hire/services compound. The planned land-side redesign would first need to be completed to move them.
It will be a costly extension compared to other flatter sites as the land slopes and requires significant infill. Fuel farm may also have to be moved and they may hope to bundle other projects such as the proposed pier or looping taxiway.
Finally funding. Nothing provided for this in DOT capital budget this year and the budget is expected to be cut further. The airport has itself been in cost cutting mode during the downturn. However as you say there's a very good case for it now. Best hope is it can be included in a revised national capital budget fingers crossed.