Could Oyasumi Punpun work as a live-action/animation hybrid type show?

I think it would work best as a live action drama series.

The manga had just good, but not amazing, facial expressions and I think a live action series would naturally improve that a lot. In contrast, anime adaptations usually don't have the best facial expressions displayed because it's harder to take those facial expressions (which are in black and white, regardless of the scene's lighting) and transfer that to animation. It's many times harder to transfer an expression from manga into anime and still have it be as impactful.

Furthermore, the contrast between punpun and everyone else can be exaggerated more with live action as opposed to anime.

A gumball-esque adaptation is the superior adaptation

I haven't read the manga (yet), so I can't speak on wether or not that style would work for it. But I love mixed media, especially when it includes animation, so I'd love to see more artists trying their hand at it!

despite being more and more into Goodnight Punpun by the chapter i reread, i also seem to not be that scared at all by the 90% chance of it being poorly adapted in the future, as one would expect. im actually excited about the 1% of probability of it being an adaptation that elevates my experience, and the 9% of probability of it being an adaptation that creates an alternate type of experience, despite not elevating my enjoyment in on itself.
i mean sure the 90% chance of failure is big, but i feel like even if it will be bad, it won't affect me much, or as much as many tend to put it out there when an adaptation steamrolls their favorite thing ever. and OyaPun is quite literally turning into my favorite thing ever.
but idk maybe im just not human

I think your idea of it being a live action limited series would be the best way to adapt Punpun. Punpun's family as animated characters and everyone else portrayed by real actors. Obviously produce it in Japan and have Japanee actors, but you really need a good director on this, and one who understands how to direct children. I don't want to see a Punpun adaptation if it's directed by a regular Japanese J-Drama director, as I've always found the production quality and direction in J-Dramas to be quite lacking. Denis Villeneuve could do a really good job with this, but if we were to keep it a solely Japanese production, Hideaki Anno would do good work.