I'm hopeful that we're at that point right now, I think we're mostly waiting for the complexity on the software side to sort itself out.

The vast majority of the market isn't in flagship phones, and even in those the last few generations of flagship features have been mostly based around software anyway.

I'm guessing we're one or two more big nudges away (i.e. - EU regulation/gigantic privacy kerfuffle/Google breakup) from a standard open-source phone software stack being a viable standalone business model almost by necessity. App stores currently take something around 30%? Maybe in the future you'll pay $25 up front for the phone software, and this open source software stack will take a 15% cut from the developer side instead.

Or maybe I'm just dreaming.

There is something like the pinephone where a portion of sale price was donated to the OS it ships with. But it is free to use any OS such as postmarketOS but you can donate as well.

The hardware is too slow to use as my main phone (it's like 10 years behind normal phone HW), but I assume that as the performance needs of average users plateaus "10 year old hardware" will be more than enough eventually. Look at how modern phones have not changed much in the past 5 years.