I've been thinking of taking the e-start off and cutting the gear housing off and weld over the remain hole. Polish it really nice and enjoy the new look without a sprag to disintegrate.
I'm still not convinced that there weren't just a bad batch of sprags. Mine is an '08 Classic AVL and has never given any problems even with the manuals recommended oil level of Mobil 1 ATF. But then I don't use the e-start much. The bike has kicked back as often as I don't kick it through properly and still hasn't come apart.
There was a bad run of sprags for awhile. That contributed to the problem occurring. The later ones were supposed to be better, but it's hard to say how much better the QC actually is on these parts. Some may be good and some not.
The quirk with the electronic ignition on the Electra also contributed to the demise of sprags, and apparently that isn't even totally figured out yet, or might have just now been figured out.
I look at it this way. Unless your leg is broken, then kick-start the bike.
It eliminates the possibility of a very expensive and irritating problem happening.
As Dirty Harry would ask,"Do you feel lucky today?"
Why use it? It's a problem waiting to happen. The kick-starter works just fine. The electric starter was never needed to begin with. It was a marketing gimmick.
I just kick-started my 2000 Bullet yesterday in 35 degree weather with one kick.
What's the big deal with needing an electric starter?
If you don't like the looks of the "tumor" on the front of the primary case, you can do as you described, and get it off there. However, if that look isn't a problem, you can just decide not to push the button anymore. You don't HAVE to take it off, although I think it looks better without the "tumor". But, it isn't necessary.
I think it's just simply logical to not use the thing, when they break often enough to cause concern. It's an optional system. You can simply choose to kick instead of push the button, and save yourself from a big potential problem that you don't have to be burdened with.
Maybe periodically exercise it a couple times a year on nice warm sunny days, just so it doesn't freeze up from lack of use over the years. That way it will still work, so you can say it still does, if you want to.