This will most likely be completely possible especially as blendshapes support. (Right now it’s rudamentary and I haven’t explored it further, so I can’t speak for custom blendshapes.)
Unfortunately with these, Its just a matter of the content creators to make all the max shape variations and bone translations (scale and translation and rotation) for the avatar mesh to enable the customization of the avatar to a level or beyond the level what is SL. Currently I’ve been working on writing one, but I have been having to do research on it.
Blendshapes (also known as shapekeys) are basically the one of ways how SL handles body shapes and facial animations. They are already used in HiFi for facial animations so we are half way there.
This means extra work for the avatar creators to allow end users to customize the avatars. We also need to think of a standardization so that shape mixes people create apply for every avatar in their own unique way.
This however only addresses base avatar shapes and textures. Attachments are still of question as we can’t bind bones of attachments to avatars own bones (instead they are just attached to an avatar bones with offset)
It also does not address entity creation to the ease of primitives in SL. But most likely we will see components made that can be used to build things. We do need some improvements to the build script though to support material selection and texture changing.
Edit: derp. Accidentally resurrected a thread from last year.