On the other hand a self-driving bus route that comes much more frequently than any existing Muni line would be nice and cuts down on the main cost, which is operator labor.
Maybe one day we'll have fully automated buses without any operators at all, but for the time being my understanding is that even self-driving cars still need a tender. The kind of bus volume (and corresponding idle drivers) you'd need to make up for a train's worth of commuters probably takes a heavy cut into any operator labor savings.
I'm not aware of a city on Earth that's been able to obtain the kind of simultaneous density and livability that places like NYC have without mass transit. Comparatively dense cities without mass transit (like Manila) are choked in traffic; changing that traffic to electric traffic will make the air cleaner (good!) but will not address the latter problem.
That's mostly paying for the tunnels, not the track. It shouldn't cost nearly that much, but it's not surprising that it isn't cheap either: the tunnels are being constructed under some of the densest and most expensive real estate in the world, and the resulting stations are significantly larger than others in the system.
And note: if you think that's expensive, you won't believe what it costs to repair highways in NYC[1].
[1]: https://ny1.com/nyc/brooklyn/news/2020/02/25/city-council-fl...