Sure, but now you're delaying your Settlers until after you've built the Government Plaza, research Political Philosophy, and built the Ancestral Hall. That's a long time to wait. Besides, you might not want the Government Plaza in one of your first 2-3 cities. Often, you can make better use of it elsewhere.
I just don't see AH working for anything but really large maps where you might continue settling until turn 150 or so. And even then, you're probably generating Settlers from more than one city, so while you'll still get a bunch of free Builders, you'll only get the 50% build cost reduction on some of your Settlers. Meh.