Iron Kingdoms is one of a handful of mainstream RPGs (Warhammer and Warcraft are two others, although the specific way WHFR diverges isn't necessarily the way I think would have been most helpful) that would, IMO, actually benefit by switching to a different system.
In the case of the Iron Kingdoms, it would entail losing a fair chunk of their RPG market. But, as with the vast majority of RPG products, the dirty little secret is... losing 'a fair chunk of your RPG market' is like losing '$10...' to gain '$50.'
Warmachine is a smash hit as a wargame, and it has a system that's actually usable for RPG play. Extrapolated ove, say, 3-5 years, the number of crossover players attracted to the RPG because its rules are familiar and compatible (and good, see below) would, IMO, outweigh the number of RPG players turned off by the switch to a house system.
Also, Privateer is... not terribly good with the d20 system. Their d20 crunch is badly templated at best, incoherent and broken (usually toward the weak side, sometimes worryingly strong) at worst.
By contrast, their Warmachine rules are tightly written, concise and well balanced, considering the mechanical complexity of the game and the relatively small scale (and thus, small margin of error). Compare the balance in Warmachine to the balance in, say, Star Wars or D&D Minis; despite the latter having less complex systems, they are much less balanced across factions and individual pieces - even at the same rarity level - than Warmachine's characters, 'jacks, units, etc.
Now, I personally am much more likely to get use out of PP RPG products if they stay d20. For one, it's a system I know where to find groups for at the drop of a hat. For another, it makes what good crunch there is portable. Most importantly, it makes the Iron Kingdoms compatible with Spelljammer.
I do think, however, that PP would benefit in the long term from exploring an in-house system based on, and probably compatible with, their much, much more successful game line.