"one of the reasons for Windows's hideous size is its backwards compatibility".
HMmm... not really. I wouldn't consider it "hideous size" these days. Considerably smaller than a RedHat5 install for example. Moreover, you can get a useable/useful Xp system in just a few megabytes... the reason it's "so big" is that it supports so much hardware out of the box, with pretty graphical UIs for everything, sound schemes, backgrounds and soforth. But who really gives a DAMN about how big an OS is these days? What's there to care about with OS size?
It's possibly more telling that RISC OS only runs an absolutely /TINY/ amount of hardware out of the box. Where's the stock USB stack, Wifi stack, Bluetooth, Firewire, DVD, smartcard, soundcard, etcetc that all other current OS's support out of the box? Sure, RISC OS tradition was to supply some low level drivers via card ROMs, but that's vaguely stupid and has bitten things badly in the 32bit world for example. It was an interesting idea for 15 years ago, but not so smart now.
"everything would need rewriting, just like everything did to take advantage of CMT in RISC OS 2" -- well, again I'd disagree - even Arthur had a Wimp_Poll and fundamentally the same WIMP structure. I reckon the biggest change may really have been around the interaction with other apps and filer in particular. And don't even begin to talk about why the hell a 21st century OS still has its fundamental operations supplied by prehistoric crap like OSByte...