how did this happen

Politishit aside, Ubisoft's philosophy drifted over time. If you go back far enough, they were genuinely trying to make very naturalistic, immersive games before they realized how tolerant g*mers are of formulaic bullshit.

I think now verisimilitude just isn't on their radar anymore. After years of copy-pasting formulas, they don't even have the memory of the games those formulas were originally based on. They're no longer aware that a videogame world even can be naturalistic. The worlds might look graphically immersive, but Ubi truly views them as nothing more than an assortment of gameplay elements. Having the environment react realistically to the player's actions is not a consideration that is even paid lip-service.

This isn't just shown through their iffy programming, but also through questionable design decisions. Look at the way modern Far Cry constantly throws enemies at you no matter where you are or what you're doing. Ubi will not allow any realism or atmosphere because they are solely focused on making the player engage constantly with the game's systems.