Additional function for Atmega 16u2 that could replace bootloader

I had a really cool idea a few months ago, but am only posting it now:

What if the 16u2 USB comms AVR could be rewired to the main processor and reprogrammed, so that it acts just like a permanently connected ISP programmer?

The ISP programmer Arduino sells uses a similar chip, so it seems feasible. This would allow for easier bare metal programming without the bootloader, end problems with damaged bootloaders, and could be easily implemented software-wise by selecting to program with ISP in the IDE menu, an option that already exists. We would also save some Flash! I must say that it seems like a great step forward now that these chips have replaced the FTDI ones. Instead of just replacing them, it can now be further improved!

Alternatively, instead of redesigning the Uno and other boards, just sell a special ISP version.

The code for doing that was posted earlier (this year? late last year?) Maybe someone has the topic bookmarked. I don't know about permanent jumpers, I think I'd rather see the user plug some wires from header to header to keep the 16U2 from interfering during normal ops.