"When they say it's "radically reconceived" does that usually mean "smaller" and "on the cheap?""
In many cases, yes, but in this case it's definitely not going to be smaller. Some of the roles are now played by two actors (a deaf and hearing actor), so, unless they cut some of the ensemble roles, you are now looking at a cast that will be bigger than the original cast by sheer virtue of the concept. And from the photos and video clips I've seen it doesn't appear to be a radically reduced physical production, though the original wasn't a very large production either.
And while it may be an extremely tight, and probably very optimistic, recoupment schedule, there must be some ideal situation that makes it possible. I can't believe that even David Merrick in his heyday would be able to find an investor willing to put down money when there is absolutely no possible way for it to recoup, let alone Ken Davenport. It might be that they only have one, absolute, best-case scenario that they must hit with no stumbles, but there has to be some scenario in which it works (maybe by combining the capitalization with a tour, as others have suggested, if that's legally a possibility?)
At any rate, fool hardy or not, I'm glad this is coming in. The Deaf West production of Big River some years back was extremely moving and I agree with some others that their approach to they way they present musicals is very fitting for this show which has such a large theme of communication and the consequences of the lack thereof.