Yes, so do I. It was limited to 800x600x16 color mode or 320x200x256. A significant amount of memory gets consumed by graphical assets, especially in web browsers which tend to keep uncompressed copies of images around so they can blit them into position.
But a lot is wasted, often by routing things through single bottlenecks in the whole system. Antivirus programs. Global locks. Syncing to the filesystem at the wrong granularity. And so on.
Likewise engineers are only going to care about doing their job. If the business doesn't reward them from taking on optimization work, why would they do it?
This is not true of all engineers and all businesses. Some businesses really do 'get it' and will allow engineers to work on things that don't directly help stated goals. Some engineers are intrinsically motivated and will choose to work on things despite that work not helping their career.
What I'm really getting is, yes, engineers choose "slower" technologies (e.g. electron, React) because there are other benefits, e.g. being able to get work done faster. This is a completely rational choice even if it does lead to "waste" and poor performance.
If you have to buy extra RAM or pay unnecessary electrical or cooling expenses because the code is bad; it's not their problem. There is no software equivalent to MPG measurements for cars where efficient engine designs are rewarded at the time of purchase.
Of course, some software other than desktop environments have seen important innovation, such as LSPs in IDEs which allows avoiding every IDE implementing support for every language. And SSDs were truly revolutionary in hardware, in making computers feel faster. Modern GPUs can push a lot more advanced graphics as well in games. And so on. My point above was just about your basic desktop environment. Unless you use a tiling window manager (which I tried but never liked) nothing much has happened for a very long time. So just leave it alone please.
Add to that: unicode handling, support for bigger displays, mixed-DPI, networking and device discovery is much less of a faff, sound mixing is better, power management and sleep modes much improved. And some other things I'm forgetting.
I was primarily thinking about enhancements in the user interactions. Things you see on a day to day basis. You really don't see if you use unicode, ASCII, ISO-somenumbers, ShiftJIS etc (except when transferring information between systems).
As a corrolary to this: I look at CPU utilization graphs. Programs are completely idle. "What is burning all that CPU?!"
I remember using a computer with RAM measured in two-digit amounts of MiB. CPU measured in low hundreds of MHz. It felt just as fast -- sometimes faster -- as modern computers. Where is all of that extra RAM being used?! Where is all of that extra performance going?! There's no need for it!