I've seen this tried. It required a considerable investment in tooling and people to run it, because the dev teams just want to run their apps and don't want to

I've seen this tried. It required a considerable investment in tooling and people to run it, because the dev teams just want to run their apps and don't want to manage accounts. And that's just the management complexity -- cross-account network adds a ton of complexity to other stuff, including VPC management, transit gateways, and sometimes DNS. Compared to having fewer accounts, the difference in complexity is enormous.