The thing is that those "20 other channels no one wants" typically cost them nothing or a minimal amount.

It is true that, if you start slicing out ESPN, A&E, etc. it would theoretically be possible to subscribe to an overall lower cable bill but the cable cos would almost certainly raise per-channel (or mini-bundle) pricing to compensate.

As bad as bundling is, it also has historically subsidized smaller channels that sometimes come up with innovative programming that would otherwise never happen.

Everyone passed on Mad Men except this little movie-rerun channel called AMC. Would Walking Dead have happened without it?

Sucks to be them. Sorry, but why should I subsidize channels that nobody wants to watch? Sure, occasionally a hit will come out of them, but if a channel can't stay afloat on their own, too bad so sad!

Well the vast majority of the money from bundling goes to ESPN. If you don't like sports, or only watch during one kind of sports season, then much of the money from cable is a waste.