Yes, I am serious. I have made a 1x1 Texture Pack (16x16 but 1 color) and it rocks. Here's some pictures.
There are many things I haven't done; only most of terrain is done, everything else is the same. Also, some things like torches and ladders aren't 1x1 because of look issues. I might just do a solid color...
Never understood this, these packs just look like trash.
And doesn't 1x1 imply that one colour is used throughout the pack? It's 16 bit because there are 16 distinct colour combinations.
Your first line is horribly offensive. Obviously lots of people like them, so how could they just plain look like trash? Apparently this is your opinion, but you don't state it as such. Try to, next time.
Nope. 1x1 means that every block is one pixel by one pixel.
There are already a lot of packs where people made every tile a single color, but their authors refer to them as "simple packs" as opposed to "1x1 pack". So although this is a novelty in theory, not so much in execution.
Anyway, you should probably change the particles and paintings for consistency's sake. The smoke animation could be a flat-colored square that shrinks until it dissipates.