

It’s hard to give concrete advice without knowing the specs or the software you want to run on this, but for tiny Linux systems there’s Buildroot so you can compile just the bare minimum you need and not use a distro at all (unless you could Buildroot as a distro). This is what OpenWRT uses to build all the router firmwares among other things.
For something that would go in a car that seems pretty ideal to me. Skip initializing things you won’t use, make something that boots to GUI in 3 seconds. When you want to update the software you flash it as a new firmware image, no on-device installing or anything.
Depending on what you run, ideally you’d skip Xorg/Wayland and use the framebuffer directly. But if you need to run a more standard environment, that’s what things like Cage are designed for. Single app, always full screen. It’s called a kiosk environment.
NixOS isn’t a bad option, I’m not sure how much you can trim it down but I’d expect it to be possible to express in Nix to install to a target that’s different from the host. Maybe not NixOS but Nix itself as a package/config manager. I’m sure at minimum it makes for a great development environment for building a buildroot.