Even opening and closing the shutter multiple times during one exposure will cause issues - but probably still possible to get under control. But covering parts of the detector will create significant variants that will be extremely hard to control for. Keep in mind we don't really want pretty pictures, but we use these images to measure the brightness of objects in those images (photometry).
In space that approach would work quite well indeed, but then you wouldn't need it in the first place..
Edit: Even if one still has to mask the streak in the data in the end, it might still be useful to do, since it will protect the rest of the image from any excess blooming.
I think you could mitigate the problems with conditions changing if (instead of blocking out the streak in the image with some per-area shutter) you tracked the satellite in the image with a horizontal (or vertical) shutter stripe which has the right width to cover the entire satellite. This would make the data lost really minor, and changing conditions wouldn't be a problem, and the exposure would be even. Does that make sense?
And space observatories are much much more expensive than ground-based ones. JWST for instance will cost around 10 billion dollars in the end - and they don't even have to pay for the launch cost (one of the contributions of ESA to the project is free launch on Ariane rocket). JWST will have a 8m mirror. Currently three 30m class ground-based observatories are being built (ELT is 39m, TMT 30m and GMT 24.5m) each with an estimated cost between 1 and 1.5 billion dollars. So you get three much much larger ground-based telescopes for the price of one large space observatory (and still have money left over).