This is where rounding gets us into trouble.... The iPhone X/pro screen is actually closer to 5.9" (5.86" if I remember correctly) where as this rumored display is around 5.68-9". That rumored display should just about fit in the current SE chassis with a bezel similar to the older pro models.
I did think about this, but as far as I know there was no information given about precise size of the rumored SE4 screen. So, for the sake of argument, I was just assuming it would be a similar fractional tenth of an inch larger than the quoted 5.7". Where did you get the figure you cite - 5.6x"?
Another thing for people to keep in mind... Old tech is cheaper to make for a finite amount of time. Sooner or later you will begin to run into obsolescence issues where in that older 4.7 LCD will end up being more expensive to make then a newer all screen OLED design. The majority of modern budget phones are using all screen OLED displays so I would imagine that antiquated 4.7 LCD is getting more expensive for Apple to procure for the SE. Transitioning to an all screen design while maintaining the same body as the current SE might actually be the more economical route.
That's quite possibly true, but I think the same would apply to other components as well - not just the screen. The slightly more modern microchips, sensors, etc. may have more commonality with what's being used in other devices and achieve better economy of scale.
I certainly don't think your theory has no merit. You might very well be correct about this even when this isn't the approach that has made the business case for the first couple generations of the phone. I suppose, to me, the XR/11 form factor, including the ~6" LCD remains the most likely. Maybe the notch goes away in favor of a hole-punch camera with power-button Touch ID, or quite possibly not.