Remember that this decision was made back when the entire system might have 32MB of RAM. Does CPython even fit in that, as a single process, let alone a full multitasking UNIX?

Additional RAM consumption has costs of its own, in terms of cache usage. Adding an extra 8 bytes for every object in the system is not insignificant. Masking and shifting is extremely cheap.

If you've run the benchmarks and can show your approach is better, by all means, please share.