You're framing this as a thing done by a greedy corporation in an evil manner, which maybe it is, but it's also just a sign of the times.
For most of the 90s and 00s, your game engine, specifically idTech in this case, was a competitive advantage. Doom and Quake/2/3 all represented massive technological jumps over their predecessors and were way ahead of their competition in terms of looks. Games like Unreal (Tournament) and Tribes competed using their engines' strengths; those engines didn't look as good but were capable of rendering much larger spaces than idTech, and those games emphasized that, e.g. Tribes' massive multiplayer maps with vehicles, or classic UT maps like Facing Worlds and Lava Giant.
Then in the late 00s to 10s, things started to hit a wall. Probably peaking with Crysis in 2007, which is likely more remembered for its engine, graphics, and system requirements (all of which were truly mind-blowing at the time) than its actual gameplay. After that, games' graphics improved at a much slower rate; it started to be less about the engine's capabilities, which were increasingly homogenized, and more about art direction.
Now in the 2020s, we have UE5 for AAA games with high-fidelity graphics and Unity for everything else... what is the competitive advantage in maintaining your own engine? As you mention, you have to have internal expertise, which is less well-documented than UE5/Unity because you don't have dedicated documentation staff; you have to maintain your own tooling, which is likely worse because you haven't invested as much in it. From a ROI perspective, unless you're planning on investing so you can license out the engine and become a UE5/Unity competitor, it doesn't make sense to maintain your own engine.
And looking ahead, frankly, consumer GPUs are now so expensive that game graphics have likely peaked for at least a decade. There will simply not be better hardware available to gamers for the foreseeable future. Games "looking good" will be more about art style and direction, and you sadly do not need a team of game engine programmers for that.