Raspberry Pi was a shot in that direction. But it's still a complex beast with 3D GPU, some embedded RTOS to get everything started, etc.
Personally I think software size should reflect the complexity of the task. And yes, a modern GUI does subpixel rendering of scalable fonts, decoding complex video codecs etc etc. But the bulk of today's massive software size is just pointless abstractions, inefficient 'frameworks' or eyecandy.
