First of all the sensor is just one part in the equation. Throw diffraction into the mix and it isn't clear whether a smaller sensor is better or worse than a large sensor. With a large 35mm sensor you need to stop down more (thus losing light) in order to get enough depth of focus, 2 stops versus an m43 sensor. And the noise advantage of the large sensor is about 2 stops, so the net result is the same, unless you want to shoot with very small depth of focus, which can be done with the larger sensor, for those few people who want it.
No. Just...no.
There is a narrow shooting window where you can coax almost FF output from an M43 sensor. Good light, low ISO, careful metering, yes. Anything outside that window and the FF has a significantly broader ability to retain color and tonal gradation information, detail, reduced noise, etc. And, it's not as simple as a "2 stop difference".
Ignoring the sensor an m43 camera versus a 35mm camera have to do the same processing and offer the same features in order to satisfy the same customers. There is nothing that causes the production of the camera to be lower cost, so expecting the miniaturization to result in a lower price is unrealistic.
Miniaturization tends to be more, rather than less expensive, also. So, unless the cameras are less full featured, use already existing technology, and are more plastic, they are not going to be cheaper when smaller.
Case in point: The G100D: This is a small camera, and it's not expensive. And it has terrific looking output. But, look what Panasonic did to get it there: Fewer direct controls on the body. NO IBIS. Not water resistant. No new components. The 20MP sensor is the same as the one in the GX9 (minus the IBIS). The EVF is the same one they are using in the G95, the S5, (and I think the G97) etc. etc.. The battery is the same as in the GX9 (et al). The image processing pipeline gives exactly the same IQ as the GX9, so it most likely is ported over from that body, also. The rear LCD is the same as on the G95, S9, S5, etc. And, the kit 12-32mm has been in production for years, so no lens development was necessary, either.
If they made a G100 with the new, faster, 20MP sensor that's in the OM3, or the 25MP one in the G9II, they would have to spend more on the sensor, processor, internal software, battery, etc, etc, and while it might still be able to be small (unless those sensors need more battery oomph), it would not be cheap, as the costs of development would be significant.
I like m43 because of the smaller size, especially of the lenses. I do not expect the camera to be really cheap, but I do find $2.000 clearly over the top. It's now a waiting game for an OM-5 II which should make the OM-5 less expensive once its successor is out. Sadly there is no news yet about an OM-5 II...
If it had been about $1700 to start, that would have been a better option, but, hey, you never know what the market will do at this point....
-J
