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Counterpoints:
Describing the graphics/art style as broken or ugly is highly subjective. A lot of WoW players like the art style as it is. I would’ve preferred the graphics got updated when I played, but it is what it is.
Updating assets and textures takes art resources, which means taking designers off of working on new projects. Blizzard’s allocation of resources is another discussion entirely, though.
A lot of WoW players play WoW and nothing else, and a lot of them play on hardware that’s barely able to run the game. Check the forums whenever the system requirements get updated with new expansions and see all the people complaining about not being able to afford new hardware. Now, Blizzard definitely shouldn’t support everyone’s dinosaur PCs forever, but they risk cutting off portions of their playerbase whenever they raise the system requirements, so I’m sure that’s taken into account.
WoW’s engine is built in-house and OLD, and started as a heavily modded Warcraft 3 engine. They most likely face significant challenges whenever they want to add or update anything, including graphics.
Note: Take my post with a grain of salt, as I stopped playing in 2018 and haven’t been playing the closest attention since.