I'm SO intensely annoyed by this episode! I'm glad that I'm not alone in this regard!
The number of people Layton has personally killed (and eaten, back in the day) - to not simply stab Wilfred when he was alone, unarmed, and surrounded... the mind boggles! As some have pointed out, Wilfred had useful knowledge of the train - but so does Melanie's daughter Alek. Between them, the rest of the engineers would have managed fine. AND - by not killing Wilfred, they directly killed Melanie - because if Wilfred had died right then, Snowpiercer would have managed to pick her up as planned!