Well, Scott, apparently you haven't looked around. There are several radios which will fit in a DIN slot quite nicely. In fact, if you go to my web site, look in the Photo Gallery under Other Installs, you see quite a few radios stuck in DIN slots. However.....
Most of the time, there isn't enough ventilation to keep a transceiver cool. Modern AM/FM/CD/DVD units aren't all that powerful. It is the amplifiers they connect them to which are. The Element has a wonderful sound system, right out of the bag, but the amps for it are placed for maximum cooling; the radio isn't.
Years ago, while working for CW Electronics in Denver, I got a chance to meet Dr. Tokuzo Inoue, the founder of Icom. He ask me what I'd like to see Icom make. I told him more or less what you suggested. I'm fairly sure he didn't design any radios just because I asked. In the mean time, LSI circuitry came into wide use, and the result was all of the "mini" things we take for granted these days.
As I alluded to above, there are just a few things you can't miniaturize, and one of those is heat. We could start using Class D amps, but then the filtering becomes a problem, and we're back to the size problem.
We can still wish, can't we?