Which settings would you choose to remain as core settings? Which would you axe?
Good question. I wish I could say I have a well detailed and thought out plan for this, but I don't. This is 100% hot take. This is also separating my head from my heart abit (some of my favoirtes aren't gonna make the cut).
The Core Setting of D&D should be a single world. It should be a fairly generic kitchen sink able to be used in a variety of ways. Obviously, D&D is lousy with kitchen sinks (Greyhawk, Dragonlance, Forgotten Realms, Eberron, Exandria, Mystara, and Nerath). And each has something interesting to give. So here's what I'd do. I'd probably pick Nerath. (What? Blasphemy!) Nerath is a modern take on Greyhawk. It did what Forgotten Realms was accused of: absorbed the best of D&D and put it in one place. And so that's what I would do again: take all the best of D&D and put it in one place. Dragon Armies. The Tomb of Horrors. Castle Ravenloft. Baldur's Gate. All of it in one setting.
Dragonlance as as setting offers almost no value beyond the novels. I'd keep it only for letting Weiss and Hickman write stories for it. Exandria is only on loan from Mercer, so he could have it back. I'd also work out a deal with Greenwood and Baker to let them do third party Realms and Eberron, but understanding we're taking the choices cuts from them to add to New Nerath. Greyhawk and Mystara retire into historical significance.
Then I treat the Domains of Dread like the Domains of Delight: incidental realms in the planes surrounding a particular personality, but ancillary to New Nerath. The Great Wheel is coming but Planescape itself isn't separated out. Likewise, Wildspace surrounds New Nerath and allows for travel, but its not fleshed out as separate setting. These "transitive" settings become part of the D&D core, but not separated out settings.
I'd ditch the MTG crossovers unless you're adding Strixhaven to New Nerath or Lorwyn to the Feywild. That only leaves Athas, who probably would be better served by a 3pp who would do a setting like that justice. Psionics is going into New Nerath.
Thus, D&D has a single oversetting it primarily focuses on, and everything in D&D is in it. From Aasimar to Warforged. Much like Golarion, its huge and hold whole regions themed to particular styles of play. Western, Asian myth, gothic horror, war, intrigue, pulp. The top three popular settings (Realms, Eberron, Dragonlance) go on loan to their creators for a cut of the profits. The transitives serve the Core setting rather than being their own thing. And D&D has a massive playground to put everything into it.
Alternatively, if that's too hard to stomach, Keep Realms and Eberron, still do the transitive stuff, and forget the rest. 3e did well with just those two.