But, if we get the correlation functions, then, can't we just employ the LSZ formula to find the scattering amplitudes, and so we need to calculate fewer diagrams?
I think that you are missing the perturbation theory in your picture. -- If you know the correlation functions, then you get the amplitudes by LSZ. But in order to get the correlation function you need to calculate some diagrams -- usually representing terms in some perturbation theory.
I put a photon "wiggle" over an external electron line.
Can I simply multiply the original diagram with my regulated electron propagator?
I thought that is exactly what LSZ is about -- the scattering amplitude is a correlation function times a bunch of $\frac{1}{\sqrt{Z}} (p^2-m^2)$factors: $$\langle f|i\rangle \sim \frac{p^2-m^2_1}{\sqrt{Z_1}} \cdot \frac{q^2-m^2_2}{\sqrt{Z_2}} \cdot \dots \Gamma(p,q,\dots)$$ Which on the language of Feynman diagrams means that you need to "amputate" everything that hangs on the external lines of the correlation function $\Gamma$: $$\Gamma(p,q,\dots) = \frac{Z_1}{p^2-m^2_1}\cdot\frac{Z_2}{p^2-m^2_2}\cdot\Gamma_{amp}(p,q,\dots)$$$$\Gamma(p,q,\dots) = \frac{Z_1}{p^2-m^2_1}\cdot\frac{Z_2}{p^2-m^2_2}\dots\Gamma_{amp}(p,q,\dots)$$ Or, finally: $$\langle f|i\rangle \sim \sqrt{Z_1}\cdot\sqrt{Z_2}\cdot\Gamma_{amp}(p,q,\dots)$$$$\langle f|i\rangle \sim \sqrt{Z_1}\cdot\sqrt{Z_2}\dots\Gamma_{amp}(p,q,\dots)$$ I hope that is what you are asking...