This is another question for the members of the Dev Team who actually do the hacking. I do not (I do the explaining. I'm the "Explainer." :-) However, if I read your idea correctly, it sounds like you are describing exactly what PwnageTool does. It deletes unwanted lines of code from the update file and then updates as normal.
2. Let's say I currently have firmware 1.1.3 with 1.1.3's baseband (bootloader 4.6). Once we get firmware 1.1.4 from apple, why can't we just delete the line that checks at&t sim card from than and THEN update using the normal process. That way, won't the update process just go ahead and upgrade the 1.1.3 baseband with the new (hacked) 1.1.4 baseband since the new firmware has the password for the same?
As far as I know, altering the bootloader is not permanent. Bootneuter can give you any bootloader you like, including fakeblank (which I have never used and don't entirely understand). I have not had much luck finding a pwnage virginizer, which makes me suspect that one does not exist.
3. I know modifying the bootloader is permanent (currently). Apart from that, I'm guessing that it is possible to revert the phone to exactly the same state that it was when picked up from the store, that is, locked to att, with apple authorized firmware etc. Or will there always be something lingering in the phone from back when it was hacked? The only reason I'm asking is if I need to take it back to the store for some hardware issues, it should look like a virgin lest they deny service ;)