Question

From what I have been reading a Linux distribution is little more than a packaging of a kernel with various packages and some limited configuration details, such as which window manager and GUI to use by default (assuming you even want a GUI, blech). In the old days apparently there were some unique advantages to distributions. For example, Red Hat had Red Hat Package Manager (rpm). Of course, nowadays rpm is no longer a unique advantage of Red Hat.

So, why even bother bother with a distribution? Why not just install a kernel and bunch of packages of one’s own choosing? What’s the complexity?

Answer 1

Basically, a GNU/Linux Distro IS a kernel and a “bunch of packages” (GNU packages) of one’s choosing.
People creates distros to perform specific tasks, like server, desktop distros, multimedia oriented distros, etc.

Creating a linux distro can be a really educational task, as you can get to know how a linux system is build from scratch.

I recommend you cheking LFS (Linux From Scratch). Its a project to guide you on assembling your own linux distro from scratch, and believe me, its a great fun and indeed YOU WILL LEARN A LOT.
If you’r intereseted on getting to known how a linux distro works, don’t miss this.
The webpage says:

Many wonder why they should go through the hassle of building a Linux system from scratch when they could just download an existing Linux distribution. However, there are several benefits of building LFS. Consider the following:

LFS teaches people how a Linux system works internally
Building LFS teaches you about all that makes Linux tick, how things work together and depend on each other. And most importantly, how to customize it to your own tastes and needs.

Building LFS produces a very compact Linux system When you install a
regular distribution, you often end up installing a lot of programs
that you would probably never use. They’re just sitting there taking
up (precious) disk space. It’s not hard to get an LFS system installed
under 100 MB. Does that still sound like a lot? A few of us have been
working on creating a very small embedded LFS system. We installed a
system that was just enough to run the Apache web server; total disk
space usage was approximately 8 MB. With further stripping, that can
be brought down to 5 MB or less. Try that with a regular distribution.

LFS is extremely flexible Building LFS could be compared to a finished
house. LFS will give you the skeleton of a house, but it’s up to you
to install plumbing, electrical outlets, kitchen, bath, wallpaper,
etc. You have the ability to turn it into whatever type of system you
need it to be, customized completely for you.

LFS offers you added security You will compile the entire system from
source, thus allowing you to audit everything, if you wish to do so,
and apply all the security patches you want or need to apply. You
don’t have to wait for someone else to provide a new binary package
that (hopefully) fixes a security hole. Often, you never truly know
whether a security hole is fixed or not unless you do it yourself.

Of course there are other tools to create a linux distro based on your HD installation, maybe for backuping purposes.

• Linux Live

And lot of other scripts to get you started, just google for them.
Of course, all of them are like automatically tools oriented for the user, so don’t expect to learn a lot from them.

There are lots, thousends of linux distros out there, so obviously is a waste of time to try to make the “ideal” linux distro and compite with ubuntu, mint, etc.

I still recommend you to check out Linux From Scratch, just as a weekend educative project . Trust me, you will learn a lot.

It covers also embedded linux distro creating, to target ARM processors and so.

If you’re on the embedded world, Yocto Project worths a look.