Because you need Lisp. That's the actual "power of Emacs". Emacs is a Lisp-interpreter with a built-in text editor. Everything stems from that. Anyone challenging "the choice" of Lisp as the configuration language for an editor, saying things like: "Why? If X is better - faster, more modern, more popular...", etc., have misunderstanding of what makes Lisp so uniquely powerful.

A specific language is not the point - to implement anything similar to Emacs, you'd need a homoiconic language or at least a language that gives you live, reflective, late-bound image with code-as-data. Without that single aspect tons of things simply and inevitably (as history shows) will get complicated.

Why we have not seen such differentiator with VSCode? Because of their design choices - the extension language and the editor internals live in different worlds behind an API boundary. Emacs essentially has no such boundary. That's the power, and also a consequence of the image + homoiconicity combo.