Couple of reasons
a) Rawr is mostly designed for lvl 85 numbers
b) The item cache would be astranomical in size. The current cache has a compressed size of 3.5 megs (7 megs uncompressed). Back in Wrath everything included had a compressed size of 8 megs. Between Wrath and Cata combined that would be 11.5 megs. Factor
in The rest and your looking at 25 megs about. The bigger the file, the longer it takes to load, which slows the overal performance. Plus it would be extremely annoying seeing AQ40 gear show up on the same screen as Firelands.
c) You gear up too quickly. Since lower level gearing got streamlined by Blizzard you will be replacing gear within hours of acquiring your previous item.
d) Only the mage model has backwards compatibility in which you can see gearing choices while you level.