1. Could Hyrule Hystoria introduce a new technological era in its timeline?
I was always a fan of Zelda's high fantasy setting that seems to be this unique amalgam of medieval and steampunk, depending on the title in question. But after I saw the above fan art, I now firmly believe that Nintendo should consider leaning more towards some form of technomancy in a future title taking place sometime after Breath of the Wild (which also seems to take a slight step away from the medieval aesthetic).
Now, I don't know if I'd go as far as cyberpunk (although this is fantasy, so the possibilities are endless), but I do like the idea of experimenting with a technomagical world in the Adult Timeline following the events of Spirit Tracks. Considering how popular item crafting is in video games, this could be a great opportunity for Link to assume the role of a machinist who, using his alchemy and mechanical skills, can create his own weaponry and supplies with a much more complicated system than Skyward Sword's.
I think that could help add a survival aspect to gameplay, as well as providing a creative outlet to players by having them figure out what kind of items they should make that'll be conducive to overcoming a given obstacle. Nintendo could also update well known items, such as bombs being based on clockwork design.
As for the main method of transportation, I could see an airship (giving us an excuse to have cannons and guns again) working as a sort of contrast to Wind Waker's King of Red Lions, to show how far technology has come by that point. But I definitely would still want this hypothetical game to be mindful of the greenery the franchise is known for.
Additionally, there's always an advantage to having different types of weapons (like in melee fights, stealth mode, etc.), so I don't see a reason to eliminate the sword, shield, bow and arrow (oh and hey, how about a crossbow?).
Though if this aesthetic isn't used for the entire game, it could be featured in a select few regions of the game to show the pros and cons of technological growth, the possible differentiations in status between the races in Zelda (for example, the Gorons become the dominant race due to their steam technology inspired by gas vents - what with their ancestors coming from volcanoes and all - and how this can be potentially corrupted), and the technology's interaction with nature and magic.
I honestly don't see why not. Everyone loves Final Fantasy 15, and that game is set in a completely futuristic world. Delving deeper into steampunk with Zelda doesn't seem to be that far of a stretch for the series, even as a spinoff.
2. Can Zelda Ever Have An M-Rated Game?
I'm just going to cut to the chase with this one and say that I, quite frankly, don't understand people's apparent obsession with making Zelda games M-rated.
Growing up, none of us complained about Zelda's rating, now did we? So, why should we isolate future generations from this already great franchise?
Unless added in reasonably within an appropriate context, "mature" themes do not necessarily speak to the spirit of a game. Zelda games are generally known for their: solid gameplay, interesting worlds, brilliant stories, strong themes, diverse characters, clever subtleties, and powerful imagery that everyone can engage with and internalize. Would an M rating itself really enhance any of these attributes? Could you honestly say that you wouldn't find it jarring if these characters acted differently (especially Link and Zelda)?
Ratings are pretty irrelevant anyways, especially when we consider the fact that a good number of Zelda games have already tackled deeper and darker subject matter without them being needlessly shoved in our faces. I love how they're able to give us that nice balance between that light-hearted, fairy tale charm and the more intense and unnerving moments (not to mention some of the more depressing undertones of life).
Inserting contrivances for the sake of an "edgy" aesthetic would not only be out of place for this IP, but it wouldn't necessarily equate to more variety either - as if Zelda wasn't already unique. What would actually make it different from other select M-rated franchises if it goes down that road? All it would do is divert attention away from the (emotional) intelligence, imagination, and uplifting sense of adventure promoted by these games. Nobody would take it seriously anymore.
Like they always say, be careful what you wish for.