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Ever since they made the announcement, I had been wondering why they didn't just keep quiet about it. Then I realized they also coupled that with saying they're not sure if they'll bring in the remaining Pokémon.
What they're doing now is seeing how people react to the news. If there's a lot of outrage, they'll make an effort to bring them back. If not, they'll leave things as is. It's still far enough from the game's release for them to make that decision, which I'm certain is why they said what they did now. If they said it any later (or kept quiet), there wouldn't be enough time. Considering all the angry reactions, I think they've decided by now. There is no way they don't know about all this. They have people whose jobs are to go to popular Pokémon websites online and read what the fans have to say. They're not allowed to interact with them, but they are supposed to report back on what they encounter.
They also cited balance as the primary reason. This convinces me more that they'll bring back the other Pokémon, bit by bit. The Splatoon games achieve balance among the weapons, for instance, by having comparatively small amounts of them at launch (remember that when Splatoon 2 launched, it had less than half of the total weapons Splatoon 1 had). After some time had passed, they released weapons at regular intervals, both new ones and returning ones. The players would take to the newly released ones, and the development team would gather data. By the time the final weapons in Splatoon 2 were released (the Sheldon's Picks set), the weapon count went into the triple-digits, yet all of them are competitively balanced.
I don't expect Game Freak to be able to competitively balance every Pokémon nearly as well as the Splatoon team balances their weapons, but it isn't impossible to take gradual steps toward that, which I'll bet Game Freak is doing, and the only way they can really achieve that is by starting small and dripping in a few evolution lines every now and then until they have them all. After all, if, say, the Drowzee line is not in Sword and Shield, how would they know what needs to be fixed about Hypno so it's as useful to a team as, say, Jellicent, which IS available?
By the way, I'm not too bothered by there being missing Pokémon you can't bring over. Of the Pokémon I have in Pokémon Bank, I'd estimate about 95% of them were sent there and have remained there since.