Should be possible
It should be possible. After all, Apple manages to do software updates. But I have not seen that anyone actually has done it.
My guess is that it would take a lot of detective work for you (or anyone) trying to create and install that different OS. The detective work would include writing device drivers and also decoding how the OS update really is done. Probably quite a bit of assembly language programming, and a few bricked devices along the way. Most probably the OS is organized into a single image burnt into memory, running the code directly. No files loaded from "disc" in other worlds, and hence no disc system to hack (compared to some older nanos, where the memory held a small boot loader and the disc had the actual OS).
The bottom line is that it needs a dedicated hacker spending quite some time to do it. And my guess is that the payback for all that work is not going to be enormous, after all the machine has few resources which would limit many interesting things to run on the box. But it is a free world, just do it!
// Gunnar