I feel like part of the issue with dwarven autonomy is that there are already games like that. They are generally produced by Maxis, and are known as "Sim City". You zone, set some taxes, and build a power plant, and then the little sims do what they want based on your guidelines. If you're really fancy, you'll put a few cities together to minimize pollution in residential areas, ect.
That's not why I play DF. That's why I play SC4.
Dwarf fortress is a roguelike game, which means that you aren't in control of hundreds of thousands of autonomous beings. Each individual dwarf (up to maybe the first 30) plays a role in your fortress, and in some cases, there is no replacement for their particular set of skills. If a system of dwarven autonomy is to be implemented, then it should be extremely minor. I would be fine with dwarves doing what they love deep down inside while they are standing around "On Break". Heck, once the economy starts, if my woodcutter decides he likes stone more, he can find himself a rock, and chisel himself something. If he gets good, I might have a new craftsdwarf. However, I would prefer to control exactly how many resources are allocated to dwarven flights of fancy.
Overall, I feel like this is a system that could be implemented to great effect, if the dwarven economy is made more readily accessible, and if its implemented as an easily controlled part of the game.
Edit: I have tried building a fortress, setting up some repeating tasks, and leaving it to see how long it lasts without human supervision. This would make it more plausible.