I dunno. The regular wood frame houses are pretty much like lego already. Cut standard-sized beams, assemble a frame out of them, put in pipes/wires, drywall on top, insulation inside, trim & paint to your liking.

Making modular wood+drywall+trim sections in a factory could make it cheaper, but that's just another way to transfer wealth from the local workers to another factory in China, conveniently excluding transportation from your CO2 calculations.