The end result would have been the same: broken backwards compatibility. The fundamental design of the original extensions was incompatible with a modern browser model (APIs only rather than hacking internal functions, separate contexts for everything, multiple processes, etc.). They chose to do it one go rather than piecemeal. So rather than having to check every version if some functionality your extension depends on is being removed you had to rewrite it once (well twice which was a mistake on their part).

It would have been gradual, and under most circumstances fixable with a bit of refactoring. Ripping the entire platform out from under people would not have produced the same result.

In the end the people who are most knowledgeable and most involved decided a gradual change was not feasible. Armchair quarterbacking them, without very specific and detailed arguments, just feels like the Dunning–Kruger effect in action.