most SVN users have a trunk for latest work, tags for creating baselines and branches for creating variants.
In my opinion it would be a very bad idea to delete the trunk because it would confuse many of your users who have experience working with SVN. There are also other reasons as you noted including the loss of history. I am actually not quite certain why you would even want to do this.
You should use branches to create variants and tags to mark milestones including production releases.
Then you svn copy the tagged release to a new branch when you need to create a bugfix.
trunk should always be your latest and greatest development effort.
Keep in mind that merging can be a challenge in SVN and using SVN in a non-standard way could lead to other problems as well.
Bob Aiello, Technical Editor