It wouldn't be much of a problem to make a CTSV type car without all the toys and gizmos which would appeal more to the type of market that we're talking about which isn't 99% of the general population it's just the 99% of buyers in that specific performance sector of the car buying market who,at present,are priced out of that market by the combination of stagnant wage levels,caused by a stagnant economy,and incorrect market placing and pricing of the product.Which is mostly the result of forgetting the idea of paying workers enough to buy what they want to buy and then using that demand to create more jobs therefore wealth and therefore even more demand and manufacturers who don't seem to have a clue about the difference in demographics between buyers who want a limo or a performance orientated fast road car that doesn't have or need the automated climate control,computerised navigation etc etc or even electric windows.
I really can't see the problem as to why performance car buyers wouldn't be able to relate to cars like the CTSV and why manufacturers can't meet the challenge of providing such cars at an affordable price.It also seems obvious that the politicians are trying to kill off proper cars and remove the demand for them and any move that would help them to do that seems like a case of turkeys voting for Christmas to me.There's no way that given the choice between just accepting that situation or just walking away,that anyone with any sense,would want to just accept the continuous political pressures to downsize cars and engines and reduce power outputs etc etc when the best way of saying to the politicians no thanks is by taking the latter option instead.Which seems to be the most likely reason for the original question contained in the topic to me ?.
The problem is more one of too many limits and restrictions not one one of any inherent issue in using the idea of the basic architecture which has provided and continues to provide just as good returns as anything available elsewhere.Therefore big pushrod V8's no problem.It's all the restrictions that the rule makers keep imposing on the idea,since the late 1960's which is the problem instead of just allowing it to be developed to the point where there's no further development potential left.I think the output of top fuel dragster engines shows that point isn't going to be found in saloon car applications any time soon.
If you want something like your idea to happen, you need to spend a lot more time going over the basics of the automobile industry, imo. The LS7 will not be affordable to middle class consumers b/c it is an aluminum-block, low-volume, performance engine. The fuel economy is not good enough to give it mainstream appeal so the inefficiencies of low-volume production cannot be alleviated. You'd need oil prices to be cut in half, but that will likely not happen b/c the cost of Canadian oil is estimated around $75-$85 (depending on exchange rate and project site) per barrel.
Furthermore, the automobile manufacturers do not want increasing demand for gasoline in the US b/c oil price volatility is what got them into this mess. The US economy can't afford to export $200B to buy oil either. The manufacturers are stuck between a rock and a hard place b/c they must meet CAFE standards, but customers cannot really endure higher costs. If manufacturers want profitability, they must figure out a way to reallocate consumer spending from gasoline purchases to automobile purchases. Automobiles like the CTS-V are not even on the radar. To the boardroom, they are ridiculous halo products, like the art house films Hollywood studios make to win Academy Awards.
You've either got to make production racing a tuner affair (no manufacturer money) or you've got to convince the manufacturers that they will sell equipment. If you can promise them $3M in LS7 sales or car sales, they might pay attention. That's how GT3 racing works, but GT3 is performance-balanced. If you don't want BoP, you'll need to devise a new model for allocating prize money so lots of manufacturers get orders, and you'll have to convince them that losing is offset by marketing exposure. You'll have to make a killer brand.
If you want the V8 to survive it must be updated. The manufacturers are not interested in updating the V8. They want to sell four bangers and V6s b/c they are less politically contentious, and they already meet CAFE standards. Besides premium manufacturers, no one cares about saving the V8, but 1% consumers don't fret about oil so they can continue using the 6L engines. NASCAR are the high-profile business who have an interest in saving middle-class power saloons and the mainstream appeal of American V8s. They are asleep at the wheel. Since Little Bill stepped down, NASCAR are constantly on the back foot. If you ask NASCAR officials or NASCAR fans, it is the world's fault for changing. Earnhardt was killed b/c he wasn't wearing a HANS device. Naturally, they changed the cars, the catch fences, the walls. While they've been reacting to Dale's death, the world has changed again. The Big 3 went under, and they were either bailed out by TARP or by EPA/DOE loans. NASCAR is permanently on the back foot.