While there's no doubt that 1) Apple could do it if they wanted to, and 2) There would be a decent number of customers for a large-screen / non-high-end laptop, I think it's very unlikely Apple would do it.
They've historically and consistently kept the large screen sizes reserved for their high-end devices only. iPad Pro 12.9", iPhone Pro Max, and 15/16" Macbook Pros. Basically a marketing / brand / pricing exercise, to keep "big" correlated with "high-end".
All those customers today who want a larger-size MBA, are they settling for the 13" MBA? Or ponying up for the 16" MBP? Depending on exact numbers / customer preferences, the increase in customers buying a larger-size "Macbook Air" might not make up for the decrease in customers buying the 16" MBP (who otherwise don't need the power, but are paying up the higher price to get it). And that's just from a $ perspective. The loss of "big" = "higher-end" might not be worth it, even if from a $ perspective, it was net-positive to Apple.
Hard to say... But overall, I think it's very unlikely Apple does it.