Being a good software developer doesn't mean you're a good network administrator or good at desktop support. And even if you are, a developer is paid more so it's a poor use of their time.
I'm all for devs having admin access on their own machines, there are too many instances where it's needed, and reasonable exemptions from default policies when they conflict with their work. But a "conflict" would be things like anti-malware software making builds fail, not merely making builds 10% slower.
Given developer salaries, a friction like making builds 10% slower is hemorrhaging money. And it gets worse if someone is actually waiting for the software to be delivered, and the amount of money the company gets is correlated to keeping the schedule.
Working in IT doesn't mean you're a good network administrator or good at desktop support either :)
Because I don't want to, and that's not (and shouldn't be) a core part of my job. It's a distraction that will reduce my productivity.
It doesn't introduce that many positives for lots of admin overhead
For the IT department sure. But I'm 100% convinced a big reason tech firms exist at all (given that every company uses "tech" in some way, right?) is simply that they know how to manage developers and make them productive. And IT policy is a huge part of that. Sure, the developers might be 1% of a typical non-tech business but they are the 1% that can give you a competitive and productivity edge, so their needs are in many ways more important than other types of employee who may not scale well.