I’m on record as not having much interest for the non-movie SW content. After the Zahn trilogy, which many fans felt was the best, I decided it just wasn’t for me. I did, however, enjoy The Mandalorian first season, though it felt more serialized than I had hoped.
So with my obvious lack of knowledge acknowledged, I’d have to guess that simultaneously developing major properties that could potentially conflict with the stories being told in the tent pole trilogy was likely a big reason to avoid that time period. Now that the ST is done, such that it is, I’d imagine the desire to capitalize on OT time period would be there.
Though, I hope not. I hope they just leave it alone, personally. If they’re going to tell stories during that time, they should do it R1 style. Sure you can have Vader make an appearance, but don’t cast young Luke, Han, and Leia. Give us new characters and new settings. And please, for the love of god, we don’t need random cameos from every extra that was in the background of OT!