JPEG-XR has (optional) lapping. But lapping has the problem that you can't do spatial intra prediction, which is significantly more valuable. And no one figured

JPEG-XR has (optional) lapping. But lapping has the problem that you can't do spatial intra prediction, which is significantly more valuable. And no one figured out how to make frequency-domain intra prediction as good until Daala. Plus deblocking filters have gotten pretty good now that they're tuned based on the quantizer used. But a bigger problem is that no one is really interested in designing a new still image codec that's better than JPEG, since JPEG can't be unseated. So video codecs are where the practical development goes. And avoiding in-loop deblocking filters there means OBMC, which is extremely computationally intensive.