They could easily do this and make a ton of money...
Again, they do it all the time for foreign markets, airplanes and television. Put yourself in the Gucci shoes of a movie executive. Do you release edited versions of R rated movies? How many do you release? The more you make, the cheaper the cost per unit. The cheaper the cost per unit, the more profitable the rentals for places like Blockbuster. How big is the market for sanitized versions? Do you release 100,000 60,000, 40,000, 20,000? Anything below 20,000 is cost prohibitive in terms of cost per unit. Has Blockbuster, a major customer, been asking for these versions?
How much money is devoted to marketing the new versions? How much to packaging?
And, lastly, make the wrong decision on this and your job vanishes.
Actually it wouldn't be that easy to do it. Not only would they have to make the cuts but they'd also have to run it by the MPAA again for the rating. The MPAA owns the ratings, you can't just say "this is the PG version of this movie" you need to get it re-rated by the MPAA raters and have them assign that version a PG. Given how much interaction it usually takes with the MPAA to get a lower rating this could be a rather time consuming and labor intensive process. Somebody would have to prove there's a sizable market for it. That's why so many of the "extended" versions are unrated, because they've added stuff to the movie they don't get to just keep the old rating, rather than go through the rating process again it's easier to just send it out unrated. Also notice how when there's deleted scenes in the extras the box with the rating usually contains an adendum indicating that the extras are unrated, same reason, nobody wants to go through the negotiation process with he MPAA all over again for 20 minutes of stuff.