I think this idea has potential but devs would have to create another server this time only for Battle Royale purpose.
Imagine 50-100 hearthlings spawn on a map that is much, much smaller than the real one and struggle to survive, exping is faster or you just start with for example 100 unarmed etc. and all you need to do is to scavenge for loot in computer generated houses in the middle of forests.
This idea is more like a "wouldn't it be cool if..." but still, it sounds like fun, at least for me.