I own both DVC and non-DVC timeshares.
The problems are:
1. Many DVC owners don't even feel like they own a timeshare and they are suspicious of them in the way many people are
2. Many DVC owners genuinely feel like anything else would be a step down in quality, their tastes are often very specific to DVC
3. DVC points can be rented quickly, maybe in a day or two. So its easier to rent your points and then use the cash to stay in whatever accommodation you want
I own a small points contract at Grand Californian, annually I can (say) book a studio for a 3 night weekend in a pretty good season. Or I could rent those points out for around $1400 and use those to rent a timeshare or Air BnB. For $1400, I could get a pretty nice 1BR or 2BR timeshare for a week in a lot of locales. But if I offered to trade my 3 studio nights at VGC for someone's 2BR Marriott Tahoe September week (say), good chance they'd be insulted and unwilling to respond to me further. Plus all the time I'd take establishing trust with someone else. Its just easier to rent my points out and take the cash in the end.