Not sure. Speculating here, but it's possible that it's because they're still working on building out GKE itself.
GKE is basically a wizard that just runs a pre-built image for the master and node VMs, and comes with some support for upgrades. There are very few settings [1] aside from the machine type. So it's pretty rudimentary. You'd think that GKE would come with a flashy dashboard for pods, deployments, user management, autoscaling and so on, but you're actually stuck with kubectl + running the Dashboard app [2] as a pod, which, while nice enough, is not integrated into the Google Cloud Platform web UI at all. Kubernetes runs fine, but GKE itself feels unfinished.
Anyway, a lot of people were asking for privileged mode back in 2015 [3], and it kind of looks like they turned it on by default rather than developing a setting for it.
