They can modify all system files just fine. The problem is that the firmware will see that the changes haven't been signed by Nintendo, and refuse to boot.
So unless Nintendo's private key gets leaked, or some other bootloader-stage exploit is found, both of which are very unlikely to ever happen, this is as close as we'll get.
And that's fine. If you want a CFW without a jig or payload dongle, go find a switch running 4.1.0. Otherwise, be happy with what we have. Because based on information SciresM has posted, I highly doubt we'll see anything better anytime soon, if at all. But I'd say we have about as much "full control" as we could ever hope for. You can run Linux, you can run Android, you've got 3 good CFWs to pick from (4 if you count Kosmos - I just consider that to be "pre-packaged" Atmosphere though.) In Horizon, we have custom themes, even animated ones. We have all sorts of homebrew, including emulators and ports of PC games. We have system modules that give added functionality like background music and FTP services. We even have cheats and game mods. I'm not sure what more you could hope for, other than booting without RCM payloads.