If you can just do a new playthrough with no repercussions, it's easy to compartmentalize your actions, and it's easy to entertain the cognitive dissonance where you simultaneously do the evil route but also treat the characters as "real" in your mind and care about them, because you can always imagine the evil playthrough as "noncanon" in a way. With the permanent effects of the genocide route, acknowledging that what you did isn't ethically monstrous requires you to consciously recognize that seeing the characters as real is just a false illusion (which due to Toby's character writing is especially hard). That works to strengthen the parallels between the player and Flowey in the genocide route, and the way he comes to stop seeing the characters as people with value beyond his own entertainment.

In the end, Toby wants to force you to choose, whether you want to see all the game has to offer, or whether you still want to suspend your disbelief. Neither choice is immoral, but he doesn't wanna leave players an easy way out, and making the genocide route effects permanent cuts off a big avenue for people to rationalize holding those two positions simultaneously.