Yes. I have done this. Works great on a friend of mine's large On3 layout. Had to raise the coupler up to the top slot to mate with D&RG type cars.

Took me about 1.5 hrs to move the wheels out. Could probably do another one in 45 minutes. I learned of this from an article in a magazine published several years ago.

Place loco in a foam cradle upside down. Take the truck bottom covers off to expose the axels and gears. Lift the axel/side rod assemblies from the trucks. Do not remove the counter weights or side rods from the shafts. Handle the assembly of the side rods, wheels and shafts gently to avoid bending side rods. I used a gear puller I purchased from Micromark to carefully move the wheels outward on the shafts a little at a time while checking spacing with a NMRA On3 gauge. Move wheels equally to keep truck centered on track when reassembled. Once satisfied that the gauge is correct, place axel/side rod assembly back into truck frames gently while being aware of the electrical wipers that contact the back side of the wheels are in proper position. This takes some patience as the shaft bearings also need to be in proper position and the gears need to mesh properly at the same time. Do not force it. If alignment is correct, then the shafts will sit down into the truck. Check that the wipers are on the back of the wheels correctly. Make adjustments if necessary for best electrical contact. Reinstall the truck bottom cover. Test run.

If later you want to return the loco to On30, just push the wheels back inward to the stops on the shaft.