While there has been some of this back in the 80s (e.g., the Williams FW14B[1]), these regulations are also blocking a whole lot of real out-of-the-box thinking.
When I think of technical innovations from F1, I think of cars that showcased really unusual technologies. Some of my favorites have been the 1976 Tyrrell six-wheel car [2], which used four small wheels in the front to improve downforce; and the 1978 Brabham BT46 "fan car" [3], which used a big fan like a vacuum, sucking the car down onto the track for better traction.
These regulations may help prevent escalation of dumb "big iron", but they also completely shut the door on any kind of revolutionary thinking.
[1] http://en.wikipedia.org/wiki/Williams_FW14
It is possible to build an uncontrollable death rocket on 4 wheels, but this would simply be to dangerous for the drivers and fans.
If these strict regulations were not in place the teams would create cars that would be self destructive.
It was the opposite. 1.5 litre engines with a lot of boost making more horsepower than they do now.
There's a far better way to help the smaller teams: Split the sport's revenues more equally.
Under the current regime, the top teams receive many times the amount the smallest teams do (e.g. more than a 9x difference between what the Constructors' Champion receives and the paltry $10m the bottom two teams are given) - http://www.hindustantimes.com/Images/Popup/2012/10/24-10-12-...
The English Premier Football League, on the other hand, splits the revenues far more evenly, with the winner receiving only 55% more than the last-placed team - http://www.sportingintelligence.com/wp-content/uploads/2012/...
For example, http://phx.corporate-ir.net/External.File?item=UGFyZW50SUQ9N... shows that Manchester United had £320M revenue in 2012; 'only' £60M of that is from those broadcast rights.
At the bottom, http://www.wolves.co.uk/news/article/wolves-headline-financi... reports a total revenue of £60.6M.
The premiership also has been trying to wall its self off from the other clubs so that they dont have relegation - unlike the NFL the worst performing teams get relegated which keeps the teams honest to an extent.
It's like one of the commentators pointed out. The Premiership is one of those leagues that even if you're mid-table, you might be safe since there are more points between say the #1 team and the #5 team as opposed to the number of points which separate the #5 team and the #20 team.
Plus, now it's just as exciting who's going down and who's staying up. As well as which teams from the Championship is getting their big break and can they stay up for more than one year?
If US teams had more of a setup like this, the story lines would be endless. I think it makes for a much more fan friendly league.
"sorry lad we love to sign you but rules is rules your going to be playing for Gillingham F.C in the second division of the Beezer homes League"
The strict technical regulations are in place for two main reasons:
1. To allow teams with smaller budgets to compete.
2. To focus innovation away from simply making bigger, more powerful engines with computers managing every facet of driver input and car output. That kind of technology will (and currently is) making it's way into roadcars anyway, it doesn't need the help of F1. F1 enforces constraints in the usual suspects (engines, driver assists, ECU, tyres, etc.) which pushes engineers to come up with genuinely new and creative approaches to making cars better and faster. This is all done within the competitive arena of sport. It's actually quite a smart way to bring about a particular type of innovation (I'm trying not to say "out-of-the-box thinking") that may not necessarily happen naturally but may still eventually make it's way into roadcars.