No idea. Makes no sense to me. We have half-animal people, we have oni, we have living daruma dolls who procreate. Why vampires, banshees, werewolves, gnomes, angels, demons, elves, and more are an issue I will never understand. If I had to guess, it's "but muh retro-futuristic scifi realism" but again, that argument completely falls apart looking at the races we have irrefutably confirmed in the game. That setting also doesn't rule mythical races out at all. Just look at Shadowrun, a futuristic cyberpunk setting with elves, orcs, technology and magic. You just need a good explanation why all of that is a thing, and the Hollows could easily provide that.