I have a 27ft 'Owl' class narrowboat built by Mick Sievewright in the 1980s, and I find it just right for me and the dog, spending most of the summer and frequent weeks in the winter on her. (When the wife and her dog come on board it gets a bit crowded). For someone who doesn't want all the bells and whistles the size is just right - mooring is easier, and moorings are cheaper and easier to find, it can turn anywhere and go anywhere, and uses less fuel than a large boat and less heating in winter. All in all much more enjoyable than a 47ft (shared) boat we used to have. Many people, boaters and non-boaters, have commented on Cygnet, saying that she would be an ideal size of boat for them. The original engine was a Volvo, and the present one the smallest Vetus 2-cylinder, the only trouble being that it is shoe-horned into the space available, making maintenance very difficult - this is the only feature I dont like about the small size.
The only boat I would consider as a replacement would be a similar sized Sea Otter, and they are very popular, with many similar internal features. OK, I know they went bust, but many people consider that is because they strayed too much from their original (small) size range. And apparently they are back on track now, after their foray into receivership prompted a wave of enquiries to the agents from people who had been thinking of buying one.
So yes, I think the demand is there, but it's not exactly a very good time to be building boats altogether, is it?
Mac