Here's my take on it.
When employers go out to recruit, they're unrealistic about how much the right people want their job. They might be used to getting deluged with applicants, most of whom are completely unqualified or unsuited to the job. But the sheer desperation out there in the online job market makes them feel powerful.
So they set the bar at the highest level, which for them probably includes someone working in the office so they can get to see them work.
Once someone has been in post a while, and you've got to know them, you've identified whether they're a worker or a shirker, and then you know what level of supervision they require. You also know whether they are conscientious enough to work from home. Also, they are embedded in the team.
Taking a leap of faith and employing someone remote from day 1 is something you might have bad experiences of. I speak as someone who had two very bad experiences of fully remote workers during covid. One was bluffing his way through, and it turned out his expectations of output were very low. Because he was supporting lots of different individuals in the team, he played us all off against each other "I'm working on this for them".
It only came to light when he lied once too often about transport delays and cancellations preventing him coming in to the office (2 stops away)
Another one breached our security, essentially building an entire remote database.
You could avoid these types of scenarios by very close remote supervision and surveillance. But very few bosses have time to do that in reality, and very few employees respon well to being micromanaged.
There is another factor. When you work from home, all the "watercooler " moments are your own. You put washing on, you do the school run, whatever. When you're in the office, those interactions, like discussing the rugby, are often conducive to team building. The random interactions between people often yield productivity ideas. Time spent talking to colleagues about non work stuff is not wasted.
All in all, I really feel that it's an example of not wanting to see the other"s perspective. If my employers' policy was that I needed to be in the office full time, why would I want someone hybrid, if I thought i could get someone who was right there with me? It's only if i can't get someone optimal that is would go down the remote/hybrid route.
Ironically I am working almost fully remotely because there is insufficient space at my workplace and it's a very long commute (over an hour). If my employer insisted I go in, I'd understand their logic. The task I've just completed would have been 100 times easier if we'd all been in every day.