So many problems in there. Remove external connections and such is unlikely to reduce price. Have you seem the Raspberry Pi "motherboard"? It has it all, it is the size of a credit card, costs $25-35, and has almost everything you need for a full computer, leaving out just internal hard drive, external screen, mouse and keyboard. What make something cheap is not entirely it's components, but also how many you will produce, the assembly line, and how many you would sell it. It's very likely the the most expensive parts of a dslr are shutter mechanisms, pentaprisms, maybe back screens, external shells, camera processors... because they are special for cameras and nothing else.
Use different a processor for instance would not reduce the manufacture price, because you would need a new assembly line just to make this new processor. Canon, that i'm shure, for each have the same processor in all it's the models, including point and shoot. The current is the Digic 6 i think.
Nor reduce software would reduce the price too much, since you also would need to redesign it. Video is there because it's a simple step to add it, since cmos technology became good enough. Even Leica has it, now.
A super manual camera in the current market would not sell enough to make it make it cheap enough. A Full-Frame entry level is expensive as hell, and it is mass produced.
I agree about the expensive parts of the camera but all other not specific parts add up.
Removing external connectors (including both physical connector and supporting chip/s) helps on the price. I don't think PI uses the top components (nor do I think nikon/canon/leica does, but let's say they do
😀 ). The components that come with a long production life (you have to have a source of components for the next 5+ years), that are reliable for a long time are more expensive. I know how the guys acquire components where I work and it is not fun searching for them and have them available for a long time. The PI, you buy it, it breaks you buy another or fix it yourself, also next year they design and produce a new one. An expensive camera in warranty, you buy it, it breaks and they pay for what it breaks.... this gets expensive. So good components even for USB support are more expensive than in the PI, and add to total price. Plus there is a calculated risk of failure that you surely pay when you buy an equipment. So you not only pay for the chip supporting USB you also pay extra x% (very small) for the calculated risks. These add up in the end.
Also removing parts is not only for lowering the price but for getting the camera smaller. Classic SLRs were much smaller.
Software does not need a total redesign, nobody that have a working product does a total redesign except for extreme cases were they screwed up badly. You start from what you already have and try to remove, let's say, the parts I have mentioned earlier. This requires work and will cost for the first camera, for the next it becomes cheaper. Only one point on how it becomes cheaper is testing. To test extra features you have to pay guys/gals to do test planing, test management, then pay guys to write those tests, then pay guys to run the tests on different levels on different teams. Less features to test less persons needed... so software can reduce overall cost.
As for processor, think of it this way. Canon uses the same processors for all camera. But on the factory line after frequency/stability and other types of test some processors run stable full power/freq some don't. Canon instead of throwing away slower digics they use them in cameras that do not require a lot of processing power. So instead of a top expeed 3 or digic 6 that is needed in 1Dx or 4D, this camera will not need a top expeed3/digic6 that goes to the bin and this saves money. Canon are smart and seem to get this part very well, other not so sure.
As for video, besides the cmos sensor you need codecs, extra DSPs and so on. You also have to pay royalties for things like H246, Mpeg 4, HDMI. Video can be done easily, this is true, but it is not very cheap.
As for Leica... the price of the Leica M more than covers the price of video.
And as I said in a previous post, this cost will not reflect in the end user price. This cost saving goes into making the camera smaller. So you lose features that you might not need but gain a smaller body that you want.