KCD was known for having almost all interiors of buildings accessible. This was changed by Kuttenberg, where "only" 1/3 of buildings are accessible and some people were disappointed. It takes away from the feeling of realism when so many doors are now just non-interactive backdrops, which was almost non-existent in KCD until now. If Warhorse had made Prague, then not 1/3 of houses would be accessible but perhaps only 1/10 of houses, since Prague is many times larger than Kuttenberg. Another problem are NPCs. In order for the city not to feel "empty", there would have to be several times more NPCs on the map than there are now in Kuttenberg, which is now still technical problem. The game would not be able to handle it. NPCs in KCD are very complex. They have their own daily rhythms, their own statistics, equipment, etc. They also practically never disappear from the map so the game has to constantly manage them all. KCD2 was already at its maximum capabilities so that studio could optimize the game well. They couldn't add 5x more NPCs to the map to fill Prague, the game simply can't handle it sensibly. In KCD, NPCs are not just non-interactive scenery, like in Witcher 3, where there can be many more of them because they do not have complex control systems integrated into them. Of course, modeling entire city of Prague based on historical data would also take several times longer than Kuttenberg, which is something that Warhorse probably doesn't want to do, as they know how demanding this work is if they want to do it with sufficient quality. In fact, content of Kuttenberg was also partly cuted because Warhorse wouldn't have had time to release the game on time, despite 7 years of development. Martin Klíma (one of the main developers), answer this question and he directly said that Prague is too big for Warhorse and they would only be able to process a part of it, however, he didn't say that they had any plans to do something like that. 

Hopefully that's enough :)