>The WebExtension API even years later is afaik still less capable than XUL.

XUL extensions were an ungodly mess and arguably hurt Firefox more than they helped. Stability, performance, etc. issues were common to be caused by them. Which when everything is in a single execution context is not fun. Most of the popular extensions simply hijacked random internal Firefox functions which is why they couldn't just be installed together.

edit: I wrote the first Tag Groups extension back in the XUL days so I contributed to the mess.

I also wrote extensions and I did not find them to be an "ungodly mess". XUL was rather pleasant to work with compared to some of the other technologies I was programming with at the time

They were an ungodly mess, in my view, compared to modern approaches which is what matters in the context of this discussion. The issue also wasn't XUL but everything else related to how extensions functioned (same JS context as literally everything else, no processes, internal FF methods were being patched by extensions, etc.). Their power came at a great cost and their approach is inherently infeasible in today's security conscious world (even if you ignore the stability and performance issues).

They also killed off Live Bookmarks. I used that for years in FF and then later Waterfox until the PrivacyOne buyout, now I have to open a separate program to read my rss (rssowlnix)

Live Bookmarks died because it was ancient code that needed to be rewritten, but most people didn't use the feature. Mozilla added telemetry to analyze feed usage and the results came back with less than 1%. It was about resource allocation for development and no volunteers came forward.

> you cannot set a locally-hosted newtab page any longer

You can still set it with firefox.cfg, it's not not documented anywhere, and will break sometime in the future

  var {classes:Cc,interfaces:Ci,utils:Cu} = Components;
  var customNewTabURL = "file:///C:/File/Path/Here.html";
  Cu.import('resource:///modules/AboutNewTab.jsm');
  AboutNewTab.newTabURL = customNewTabURL;

> will break sometime in the future

To be fair, with Mozilla, it would break sometime in the future even if it was documented.