> Digital is more capable of faithfully reproducing sound than vinyl is.
That's exactly the problem that makes digital unsuitable.
Theoretically digital can reproduce sound faithfully, but if the medium allows sound engineers to compress the hell out of music, then they will abuse the opportunity.
Vinyl is a very limited format and you can't really do any sort of "creative" audio optimization bullshit with it.
Compression in the audio waveform sense has nothing at all to do with the medium. You can absolutely press the same compressed masters on vinyl or release the uncompressed masters digitally. It's a matter of what the customer base is looking for. Digital music is made for the mass market where "louder" means standing out and thus more success while contemporary vinyl is made for the enthusiast who can afford high-end equipment and clean listening environments.