One problem of making the rewards better is bots will just farm them all the time. And it's annoying to do fates as a legit player when that is happening because the amount of bots hugely scale up the difficulty of fates in the zone, so you are forced to pretty much follow the bot swarm to whatever fate they are currently doing to clear anything in a reasonable amount of time.

If fates had mechanics it could be both a bot deterrent and more fun for real players, but the devs have said it takes too much time/resources to design every one like a critical engagement in bozja, so for that reason Endwalker fates will be the usual no mechanics mash-keyboard and win.