Seems to me the only way to build a truly custom distro is to pick the programs you want to run and work backward. Install their dependencies, the dependencies of the dependencies, etc. Compile the kernel with only the modules you need.

“I am not sure why anyone would want to develop their own.”

Why do people make/build their own things? Why do people buy aftermarket parts for their cars? Personalization. To have the satisfaction of building something with their own hands. To have the features they want, not the ones they are dictated to have. Because they think they can build a ‘better mousetrap’. Because they like to tinker.

I have been distro-hopping since I tried my first distro. I have used over 100 distros. They were all more or less useful but they all either lacked features/packages that I want or they had features/packages I wanted to uninstall. Let’s not forget that distros represent either some developer’s idea of what is “the best” or a compromise that will be acceptable to the largest number of users. Once installed, they have to be ‘tweaked’ by the individual users, which may or may not be possible. So why not skip the ‘install and tweak’ and just build your own right off the bat?