Problem with web components is that they have a few gotchas, one has to solve it he wants to use them effectively. I agree that SSR is a problem, if it is a problem. Crawlers now render JS, I have not see any benefits of SSR for a long time now.
Also there are a lot of mentions of Shadow DOM. Why would anyone want to use that? It is slower, detached from main process. Just use original DOM and modify it.
Also, if devs "want!" native components for React, Vue, etc., that does not mean Web components are bad, that only means devs want native components for their FW :).
I personally hacked my Web components micro FW in 2 weeks, and started to replace Svelte and Rails/StimulusJS with it. I am every happy, but you need to know how to handle gotchas.
You are right. For transparency, I also work for Corbado and was part of the discussion. I think most of the developers prefer a native component if they have a framework in use. In this case, because of the SSR trend, it's just a bit more difficult to use web components as a base for all of them. Would you not agree? Of course, you could offer native implementation in all variants, but that's very difficult.