I visited the Wilkes-Barre and Hazelton Railway on Saturday night. By chance, the photo I took of the remains of the station was taken from very nearly the same point that a historic picture was taken:
Some people in the house just to the right of the modern photograph told me that yes, this was the trolley line heading underneath the mountain. They said that the tunnel was blocked about 1/4 of the way. Being a half-mile tunnel, that implies that you can still travel 1/8th of a mile under Penobscot Mountain. Unfortunately, I didn't have time to make the one-mile hike back to the tunnel portal to investigate.