I think you’re just repeating the impact of the low ground clearance, rather than explaining why there still has to be low ground clearance.

You’ve said they can’t have larger engines because ground clearance is low... we already know that... but why must ground clearance be low?

Ah, you mean why did they originally do it? Sorry, I misunderstood. The original reason was that the 737 was designed that way so that it could be boarded with just stairs instead of a skybridge: https://simpleflying.com/737s-low-to-the-ground/

This was super helpful to small carriers at the time, but as time has gone on it's caused problems.

Because they would have to redesign the parts of the fuselage that holds the landing gear when they are retracted - as far as I know, there's not enough room to house taller landing gear.

Boeing did actually design extendable landing gear for the 737 MAX-10 model, which hadn't shipped yet. That aircraft is longer. To avoid tail strikes, the rear gear becomes longer as the aircraft is taking off.

I'm sure that costs more money. If it were on all 737 MAX aircraft, perhaps the engines could be lower. It'd be like a kneeling bus that gets lower when stopped to take on passengers.

Another option would be to make the engines move. They could be folded up or slid up-forward when driving around the airport. The FAA might have issues with this though. I don't know of any aircraft that does transformer stuff while zooming down the runway.

True, there are planes that compress the struts before retracting the gear for the gear to fit, so perhaps something like this could be designed for the 737 too? But that's increased complexity on a non-redundant part that you definitely don't want to fail, so it's not obvious how the trade comes out...

Not "perhaps". It actually was designed for the 737 MAX, which comes in 4 lengths. Only the long one gets the fancy gear.

Short video with gear model in action: https://www.youtube.com/watch?v=F4IGl4OizM4

https://www.geekwire.com/2018/boeing-737-max-10-landing-gear...

Scroll down for a nice diagram: http://www.b737.org.uk/737max10.htm

To be fair a similar system on the Dash 8 Q400 has a pretty nasty habit of folding up on landing.

You're talking about changes that would cause the plane to be a very different plane than the 1967 737, and would then need a new type rating. If you're going to do that, you might as well just throw out the 737 design altogether and make an all-new clean-sheet design. Boeing wanted to avoid that because that costs a lot more money and pilots would need retraining on the new type. They wanted to be able to call this piece of junk a "737" and claim that pilots didn't need any new training to fly it.

Because the airlines use hangars that are built for the current dimensions of the 737, not a bigger airplane.

And also you can't just redesign the landing gear without redesigning a substantial portion of the wings.