We could and it is always better to have fixed sized arrays, but having no choices is totally different situation than doing something preferable. It will make your life much harder in some operations such as string manipulation.

Having minimum 64KB of WASM memory is still a huge cost for mainstream microcontrollers. Most of dynamic memory stuff in embedded system requires at most ~10KB (and often less than 1KB) of memory. We are just throwing away the rest of the precious memory.

On a microcontroller one probably controls both the runtime and the application. Is there something that prevents configuring the run-time to have only 1kB memory (stack and heap)?