Obviously a longer take off distance would allow for greater weights to be carried, but that's not the current or foreseeable situation. In the meantime, bags are often left off (especially in inclement weather) because of weight issues.
Also, the problem with less people on board and more bags is the weight and balance issues that this situation creates. There's not much room in the front cargo hold (maybe 7 bags max) and a plane with less than 60 people but a full cargo hold causes problems (like being unable to take off unless bags are left off).
The fact is that when bags get left off people get pissed and blame the airline. If they know this is a perpetual problem, they're less likely to fly with that airline.