For almost any distribution, we have base OS template and a set of customized derivatives with custom sets of apps installed. Every single one is updated separately. Would an overlay system like UnionFS make this more handy?
Sounds like a good idea.
The base template would become easier swappable since you don’t have to change anything on it itself and could do it all in separate unionfs layers.
If implemented, you could manage your qubes and the unionfs layers as groups, assign a set of tools to the vms that need them.
The issues I see are that you would need to provide additional block devices - the layers - to each vm. If a user goes very granular, xen would need to add ~50 more devices to each vm. Don’t know how well that would work out.
The update process would need to be redesigned. You’d either need to boot into every layer version and update your apps there or have a new way that allows for a single update vm to chroot every version and do the updates.
Sounds like a lot of effort to do it right…
For your current situation, maybe use flatpak+appimages for very niche installs and allow for some unused apps in the template. That might allow you to get your template count down.