What does 'by' add to here?
They walked along by the old canal.
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Sign up to join this communityTo denote that they walked adjacent to the canal, rather than along it.
The phrase could alternatively be written:
They walked along beside the old canal.
They |walked along| in silence. [right, we say along so it doesn't sound so abrupt and provides the idea of the ongoingness of the walking, no canal]
They walked |along the canal|. [right, means: the path or banks that are located beside the canal]
Here's the tricky bit: They walked by the canal and into town**. [they passed it during their walk].
As in: They walked by the school to the park. [they passed it and reached the park].
However, they walked along [in silence] by the field or canal means:
They walked along [ongoingness idea] by the field or by the canal with nothing else, means: they were parallel to it and not walking past it.
walk along = to stroll, to walk unhurriedly in an ongoing manner walk by [some thing] = [go by or go past something] BUT: walk by [some thing] can also mean: along or beside some thing.
But both together can only mean: to stroll or walk along the length of a thing: a road or path that goes by a field, a river, or other structure.
Don't forget that by is a preposition which, besides its other numerous meanings, basically means this:
near or at the side of
So, what the quote in question is saying is that they were walking along the old canal and the walking process was happening very close to it (or, in other words, by it).