I agree that transit is ultimately the most important.

Then it won't be a question of mass transit vs. bikes but both together - that'd make a bunch of more commute options workable for me.

That said, I'm not greatly convinced that this model is better. It's more efficient, certainly, but I regard this in the same way that a nutrient paste is more efficient than eating regular meals. Walking as a part of daily life strikes me as something that has a lot of positive externalities.

I can't take a bus from my driveway to my work. Nor does the path a bus take usually end up being the most direct one.

Single-occupant vehicles simply occupy too much lane space, especially at peak use hours. Transit routes are most efficient when structured as point-to-point. I've seen several commuter systems in which buses collected riders over a small area, then travelled to a (preferably concentrated) business / commercial area where riders disembarked. You limit loading/deloading and dwell times, and maximize time-in-motion (which increases net average speed). Most urban transit systems achieve net speeds little over a walking pace (10-15 MPH isn't uncommon) due to frequent stops and congestion.

The real killer with transit systems though is transfers. Having to wait 5-10 minutes (or 20-30) for a connection really extends your commute time. Realize that at highway speeds, that translates to 5-30 miles of commute distance, and even at urban speeds, 3-10 miles of lost travel distance. To say nothing of the stress of wondering where the bus/train is and when / whether it will arrive.

So: with an autonomous self-driving multiple-occupant vehicle, passengers could flag a ride, the dispatching system would match requests with livery by start and end points, and route accordingly.

They are better for some things and worse for others. They are less efficient per passenger-mile, so they are worse for high-traffic arteries. OTOH, they are cheaper per mile travelled, so they are better for connecting the endpoints to the well-travelled arteries, and in some cases (where relatively little of the trip is on a well-travelled artery where mass transit is efficient) for end-to-end services.