Lots of reasons actually BAs have lower distortion over most of the audio spectrum. They provide better insight into music. Additionally, since they are small, you can use multiple units in a multi-way design, further improving the sound quality either by paralleling them or using specialised drivers. Dynamic drivers are amazing at bass, which BAs don't do that well on their own.
A BA or set of them just jammed in your ear canal isn't going to sound pleasant; you need more space for acoustic tuning, crossover components, and so on.
There's also a minimum size you'll want to make an IEM - the "cylinder slightly larger than the ear canal" design works in limited cases, like with all the single BA designs from Etymotic, if you're okay going deep insertion. Many aren't, though. Pretty much all other IEMs are close to the same shape and size cause that's what works for most people.