tl;dr Game Freak’s obsession for signatures (and minmaxing so constantly) is to blame for the power creep in later generations.
Not to mention that, as we go on, the Signature Move and Abilities are becoming more and more specific. It used to be that the Signature Moves/Abilities, while certainly fitting of the Pokemon they're initially assigned to, also had a vagueness to them that allowed for some wiggle room to be given to other Pokemon; even if they were Legendary. Now there's plenty of Signature Move & Abilities where, if they decide they want to give them to another Pokemon, they may have to specifically design a Pokemon just for that purpose (be it a new species or Regional Form).
Unfortunately, I see the above as a necessary evil to keep a given long-running series going.
(...)
Ultimately, they make these games for money. If the newcomers aren't "strong", people are not likely to use them, which results in less merchandising sold, and potentially boring / stale metas.
Though it would be nice if they also weren't so adverse to change that they could go back to older Pokemon and give them a sprucing up. Past gens they gave a handful of Pokemon some more BST though it was only a handful and I don't think they did it for any Pokemon this generation. However for some Pokemon they should just do a revamp on its stats or a very least actually specialize them, which includes maybe giving them some Signature Moves/Abilities (be it new ones or taking some of the newer ones). Also introduce an Ability Tutor and let Pokemon learn more than the max 3 Abilities (and/or maybe let Pokemon have the capability of having 3 normal Abilities and 2 Hidden Abilities).
If they're not going to stop making OP Pokemon, at least go back and apply the same principle to some of the older Pokemon who you have no reason to keep down.
Would be much better if either they'd just let the series die, or actually hard-commit to dexit and REALLY reduce the amount of available mons in a given gen to a manageable number or straight up start allowing only current gen pokemon in a game, kinda like some card games do set rotations.
And even then, you will get the dexit conundrum of angering or not interesting the people who would rather have their favourites, because they never committed to it.
Dexit was poorly received because it was poorly handled. GF did just about EVERYTHING wrong with what could have been a golden opportunity to do a semi-reboot. The biggest of course being the very announcement of Dexit.
This announcement needed it's own Direct. We needed the top members of GameFreak, the Pokemon Company, and Nintendo to appear and tell us why it was decided it was the time to do this, what the plan is, and promising that the roster of returning Pokemon will change so your favorite won't be forgotten and of course there's plenty of side games and merchandise for them to appear in. THEN, they should have made a special section on the SwSh site where they showcased some of the older Pokemon that are returning and even mentioning some which aren't and explain the reasoning why; SHOW that plenty of thought is being put into these decisions. And, on their end, now that they don't have to worry about every single Pokemon, give a look over to returning Pokemon and maybe adjust their stats, Abilities, and movepools to give them an up-to-date treatment.
But what did they actually do? Instead of treating it as the big change that it was, they tried to downplay it. They had Masuda, who while a top staffer already was gaining some unfavorable attention due to some things he had decided and said, try to sneak it in an E3 Treehouse demonstration before hurriedly moving along to the next topic. And then, when everyone predictably freaked out about it, took a few weeks to respond to the outrage (likely hoping if they stay low it'll blow over) and then only gave a meager few paragraph addressing of the issue. And, despite promising this was done for quality reason, well the games than came out, notably animations were really not that much approved from Gen VII and of course the older Pokemon didn't get much improvement. It felt like a decision made from a rushed development and GF's programming incompetency (notably not compressing files).
Oh, and as a bonus, that hypothetical Direct would have also mentioned the decision to not bring back Megas or Z-Moves and for now on old super mechanics will be brought back on a case-by-case basis. But how they actually handled it was a quick mention of it in a Japanese magazine interview with Masuda. This just further made it seem like, instead of treating this like a new opportunity to focus the games, GF felt ashamed of doing this which doesn't project much confidence in the fans.
More like no correct solution at all, I don’t trust the fanbase to agree that a full reboot will be a good thing.
I don't even know what a "reboot" of Pokemon would even look like.
Going back to the original 151? Doing 150/200/250 but only with the "popular" Pokemon (which would by going GF's definition and not the fanbases, so would be a lot of odd pulls)?
Would they keep the original designs or make new ones? Combine certain similar Pokemon or evo stages together?
And of course there's the Region and human characters. Do Kanto once again or make it a new Region (or a new Region named Kanto which has some similarities with the old one)? Keep the setup or the Pokemon League (Gym Leaders, Elite Four, Champion) or do something different? Do you make new human characters or reuse old ones (and if its a new setup give them different roles)?
And of course there's the anime, TCG, all the spinoff games, merchandise, and I'm sure dozen other things I'm not thinking about which would have to adapt to a radical thing as a reboot.
The idea of a quota to fill makes me wonder if it's why they keep avoiding certain "gap" moves people keep asking for (like a big Electric Phys move or 90 BP Flying attacks), something to use for a new-move requirement if they can't come up with anything else special ("signature" or generic)
In addition to what Worldie said, there's also appeal factor. Just like how it took us till Gen 6 to get a T-Rex and Gen 9 to get a Dolphin, while it's not on the same level as getting a new Pokemon based on a well known animal/mythical creature/object/etc., a new (generic) Move which fills in a missing gap for many competitive players is itself a draw toward the new gen (and away from the older, more familiar).