Why on earth would that be off by default though?

Best guess is Apple finds it slightly unaesthetic and considers it more of an assistive function rather than strictly necessary for everyone.

I think its been this was as long as OS X has existed, maybe even earlier versions of Mac OS were the same?

For simple users, perhaps because it might be confusing (press some keys accidentally, something suddenly happens in the UI).

For some power users, perhaps because if you don't need it, it hijacks a lot of key combinations that you could use as custom keyboard shortcuts.