Hi Chris,
what kind of "consolidation" are you thinking of regarding the Witness appliance?
Indeed it is a normal ESXi install and is treated like this in terms of management, patching etc.
On the other hand it serves a special purpose and that is storing vSAN witness objects only. So it does not run any VMs.
The installation of the appliance could be stripped down, you could e.g. remove a lot of hardware drivers and the embedded VMware Tools ISOs, but that would not really save you anything except some marginal disk space.
- Andreas