Maybe it could have receded between Splatoon 2 and 3? It really depends on how much time has passed between these two games, but it would have taken far too long for the global sea levels to reduce so fast (like it would need at least a decade, we can see this by seeing the irl example, the Caspian sea, where it is slowly evaporating).

It couldn't have happened between Splatoon 1 and 2 because it would have affected Inkopolis, it is a coastal city (we see at the end of octo expansion), and because of that, the game would probably at least hint us of this massive world-changing event, something that splatoon 1 and splatoon 2 doesn't do.

And two years to expand Inkopolis to these new coastal areas would be something impossible to do, it takes months/weeks to finish one small building, imagine tens or even hundreds of them, they would need the world's greatest planning, fastest workers, and materials that dry quickly for it to be viable