Linux is one of the greatest open source projects of our time. And the way things stand - it will remain so for a long long time.
I think the answer is simple - user choice.
A user can choose what filesystem they want to use, what desktop environment feels the best to their aesthetic, and underlying hardware is a good match for their work/play requirements.
A person who makes their own meal is going to complain less about the taste than someone who orders something they heard is good. People love their Linux customisations for the same reason.
But when you build a Linux distro for IoT products, there is no single user. The device belongs to multiple people, and/or is more often than not managed by a commercial entity. So when you design a distro for your router, that flavor of Linux is going to be opinionated in a way that restricts user choice. When you sell a router that runs OpenWRT, do really want to ask the user to fill out a form asking them what kind of filesystem they will prefer? Probably not.
So building a distro for the machine world instead of the human world requires a fundamental change in the Linux philosophy. The same folks who build desktop environments and package managers are going to have to design their UX in a different way - a way in which there are sensible defaults and the focus is on getting the job done, and not on customization .