There is no technical reason why you can't make an 8 bit CPU at GHz clock speeds. You can make a 32 or 64 bit one, so you just reduce the bus width.
The question is, what would you use one for?
The faster you vibrate electrons in a material, the more energy the dissipate as heat. This means that a 1+GHz processor could not be used in a low power application due to the energy wasted (part of that is smaller transistor size though), nor could you use one without a large heatsink to dissipate the generated heat.
A hobbyist couldn't in all likelyhood use one because with a 1GHz clock, even a 1ns propogation delay would be a missed clock cycle. This means you would need a precisely designed circuit board with all traces in a databus exactly the same length.
Breadboards would be totally out of the question, so would protoboard. Even a slight amount of stray capacitance would essentially mask a 1GHz signal.
Such high speeds require expensive manufacturing methods, meaning a £2 avr at those speeds would be out of the question - think £50 and up, just for the CPU and that still leaves you requiring fast enough program memory, ram, peripherals, etc, which wouldn't be on chip.
For a computer, performing calculations using 8 bits would result in an incredible performance reduction (unsigned long long math takes about 100 instructions on 8 bit, whereas it would be about 8 maybe less on a 32bit processor), meaning they would simply not be suitable.
If you are going to go to the effort of designing a high speed microcontroller, why stick to an 8 bit bus, when you can easily use 32 or 64 bit (the technology is already there). It would be like building a ferrari and sticking a moped engine in it.
20MHz isn't the limit though. Look at the atxmega series. 8 bit microcontrollers, with similar peripherals to the atmegas, but running at 64MHz.