Nonsense! There are 4 wires in an S-Video cable. With a little care and touch you could easily shorten your cable just fine. Chop off a section of wire and match the colors to re-merge them. Or, get a new interconnect from your local electronics supply store and use that.
A long as you take care to keep the individual wires the same length, you won't have issue with bad signal strength (you aren't lengthening the cable, afterall). Interference however, could be an issue as Grayscale pointed out. To combat this, simply get a shielded interconnect from Radio Shack and use that instead of the old cut off one. I would challenge anyone to find a meter-able or noticable difference in signal output this way.