As far as long hair goes:
I believe it's something to do with the bones used for physics (Or, an approximation of physics based on original 1.0 spaghetti code for character creation) that make it more work than shorter hairstyles.
As far as race-limited hairstyles:
Due to the aforementioned 1.0 spaghetti code, they have to essentially manually create each hairstyle from scratch for each race. Which is a lot of work which could be spent putting new hairstyles in.
Essentially, it comes down to the fact that, as they're reluctant to completely rewrite the code for character creation from the ground up with sensible 2.0+ versions of code (For reasons such as the manpower it would require, as well as the fact that they likely wouldn't be able to recreate characters with 100% accuracy (Thus would receive complaints) and also would have to completely re-build every unique character in the game) that basically anything revolving around character creation is really annoying to try and do, with it mostly revolving creating new models to add as separate options for each specific race/gender (Thus the inability to say, flip which side a parting is on. As it would require a completely "New" hairstyle option that is the flipped parting...)
Basically, because 1.0 devs had bad code and because Papa SE diverts most of XIV's money to other titles, it's not particularly efficient to work on these things sadly...
(Though, I'm sort of hoping that if ShB performs well that maybe after VII remaster is done XIV's team might get some more resources...)
Really, if we could get them to 2.0 code characters it would make adding hairstyles and customization options a lot easier (You know, like, butts) it's just ridiculously unlikely
