Echoing others, setting a 16 MP camera to 10 MP would not deliver better resoluton, it's still just downsampling the image, and it would be better to do that in Photoshop. But, would 4 MP be enough for you? If the camera with a 16 MP sensor was designed to do so, a could bin 2x2 arrays of pixels and deliver a 4 MP image that would be superior to downsampling the 16 MP image to 4 MP.
Ok, so 4 MP is too low, fine. But extrapolate that to a 36 MP sensor (not that I'm naming a brand or a specific rumor or anything). If such a camera were designed to do 2x2 binning, some very nice 9 MP images would result, especially in low light shooting situations, and those 9 MP images would be 'real' resolution without the demosaicing normally performed. Now, if those 9 MP images were generated for customers who, hypothetically-speaking, were historically used to cameras with lower MP counts than competing brands, well...that might get interesting!