> I think there is a strong use case for a Arch-like Linux distro that has an open architecture for building the entire distro from source into container images automatically.

That's what Fedora Silverblue is all about https://silverblue.fedoraproject.org/

I'm not sure what will happen after IBM's acquisition of RedHat but as far as I remember the last announcement was that Silverblue will get the best bits of CoreOS (in turn acquired by RedHat) and Atomic Workstation.