Low n Slow. The Mode S transponder does not need inputs from a FMS or air data computer to perform it's basic function of selectively addressable beacon transponder.
The lower end GA crowd has successfully put off equiping with state of the art transponders in this country for 15 or 20 years. For this reason there is a lot of code patches in the ground systems that is used to filter the c&*p that some transponders provide. The result is a plumbers nightmare of spagetti code to maintain and operate in real time all the time.
I sympathize with the obvious stupidity of requiring high tech avionics on light aircraft that are not flying on, across or near airways and will never enter a major airport's traffic area and have no need or desire to be seen by ATC or to be provided radar services. Should be some kind of release form for you to sign so that if you are up s creek without a paddle some dark and stormy night and need a vector or need rescued, well, they'll do their best but.....
Transponders themselves (even mode S ones) are not in and of themselves very expensive. The problem is the certification approvals and then the installation that can cost a huge huge amount, 2 and 3 times the cost of the transponder. Then you have maintenance. Part of the problem seems to be the way they a re bought by individual owners (retail if you will). Possible huge price brak if batches of a thousand or so were sold. Maybe the GA owners organizations could turn to on that issue and get some CAA cooperation, but then again that is too much like hard work and not near as much fun as moaning about the rotten nasty regulations.