It's the "pick any one" nature.
You have to classify every title as one type.
How would we classify Zappa, or Secret Chiefs 3? Are they jazz, alternative (a worthless category), rock, pop, heavy metal, comedy? Depending on what you listen to, it could be any one of them. Also, each song could be in multiple categories. Boz Skaggs was known for disco-style pop, but he was an outstanding blues performer, and many of his songs reflect that mix.
This is really a music industry problem, and software just reflects that. The bug is really in the Requirements phase.
Well, it's less of a technology problem than it is an industry one. You can have multiple entries in the genre list and they're freeform, for example Ambient;Electronic, in both ID3v2.3 and ID3v2.4. For Vorbis Comments, you have multiple GENRE= tags. Some players support this.
In my interactions with distributors, it seems streaming services tend to support up to two genre classifications; though they're pretty outdated and general (even more general and dated than the Winamp genre list). I don't think they use the metadata presented much in the classification; in fact Spotify does its own estimation of 'energy' and other subjective emotions using various classifier algorithms.