You've pointed out that things attached to dragon tears and star fragmentd stay spawned in, so it would follow that they could easily allow this for all objects in the game,
No, this doesn't follow, because of the additional limit of 20 attachments. Which is another hard gameplay limit that I didn't even mention. So, effectively, there can be a maximum of 10 objects that aren't single dragon parts that don't despawn at extremely close range. You can't fell a forest and just have the logs sit there.
You could argue, "well, Nintendo doesn't want that", except Nintendo have programmed it so that it
remembers that a tree has been chopped until the next blood moon. You can fell the forest. It will stay felled for a decent amount of time. It's just that, any product of that chopping, the log, the fruits, the
useful consequence of the chopping, disappear at close range. There is the intention to remember the player's interactions, but an inability to follow through fully. All they can do is set flags: Chopped, not chopped.
Nintendo can't make the world more persistent with the Switch's hardware. And we know that making a more persistent Hyrule is something they've wanted to do for a very long time because when talking about Ocarina of Time's 64DD expansion, Miyamoto was focusing on ideas like, "if you drop a weapon, and then go exploring for like fifty hours and then come back, the weapon is still there. If you chop a sign, it stays chopped."
Even the free-form physical interactions in open-world Zelda are merely the manifestation of ambitions that are decades-old. Refer to Miyamoto's delight that a chopped sign can fall in the water and float there in Ocarina of Time.
Aonuma, in at least one interview and one statement that I can recall, has acknowledged that fans want to be able to
change the world of these games, but has so far only been able to deliver that in limited, scripted form.
The Hudson construction signs, for example, are a small example of this. Does it improve gameplay that the signs are fixed at the angle you left them in? No, of course not, but it adds to the tactility of the world. Which is clearly a focus for the Zelda team at this moment in time. But Tears of the Kingdom is a game that is
so obviously held back by its hardware that it just continually blows my mind that people keep bringing it up as an example of the opposite.
And this is just persistence. Another consequence of the "we can't store anything in our RAM" is that you also can't really do things at a distance. Throwing a bomb in a cluster of trees in Breath of the Wild fells the trees. Firing a canon from 200 metres away into a cluster of the trees does nothing.
You talk about the old Zeldas, but Link to the Past and Ocarina of Time both featured the draining and filling of large bodies of water. This is something that isn't currently possible under the "we're doing shit for real this time" paradigm of open-world Zelda. Probably not even on a PS5. But it's a clear goal to work towards. Fluid mechanics that you can manipulate in real time will be a mind-blowing gamechanger whenever we eventually see it, people aren't ready for it. But also, from this, you can also infer that traditional Zelda wasn't constrained by the same limitations. Once you made the world seamless, all you could do is make it prettier. But that is the difference between open-world Zelda and, say, God of War. And I say the former has much greater room for growth, and stands much more to gain from technological advancement, and to suggest that Tears of the Kingdom, of all games, wasn't severely limited by hardware is just
absurd.