That would be a huge breaking change. Any workload that relies on re-using a bucket name would be broken, and at the scale of S3 that would have a non-trivial customer impact.
Not to mention the ergonomics would suck - suddenly your terraform destroy/apply loop breaks if there’s a bucket involved
Any workload that relies on re-using a bucket name is broken by design. If someone else can get it, then it's Undefined Behaviour. So it's in keeping with the contract for AWS to prevent re-use. Surely?