People have a choice how to go to that far town: take the slow train, or take the express. The train that brings them first wins. You will see that about 10%-20% of the people in the slow train will stay on the train and travel on. Those 10 people are about the same amount as those taking your express train. Your express train is in direct competition with your local train.
And it is not the 20-minute rule that is the problem. The biggest issue about the equasion of travel time, is that the unload and load time are not take in account with a local train that stops everywhere. When one excludes this from the equasion, the express and local train travel equally fast (if using the same engines). The travel-simulator can not make a difference between the two train in aspect of time, and so your long distance travelers are split evenly between the local and the express train.
One could tackle the problem by constructing high speed tracks passing-by the smaller villages, and using high speed trains to go faster. Then you will lure more people to the express train.
At least, all above is my observation and deduction. So a lot of speculation, because I do not know the actual algorithm. 😉