Ugh, that last bit about non-Galar Dex Pokemon being barred from Sword and Shield (and said issue affecting future games) is just disgusting to even read. Whatever happened to that promise Game Freak made when they announced Pokemon Bank?
I can only hope it’s just enforcing the usual yearly VGC restrictions and NOT an indication of some Pokemon being left behind in Bank to rot like festering garbage.
I imagine that available Pokemon will be rotated every new generation so that you will eventually be able to use other Pokemon on later Switch games, if not in Pokemon SwSh. What this means is that it enforces a permanent casual and competitive meta change in Switch Pokemon games, which could bring much more life and change to the competitive meta.
But it also sadly means that the National Pokedex is likely dead from Generation 7 onwards because of this. It also means that Gen 4 and Gen 5 remakes are even more unlikely, if not impossible, unless all Gen 4 or Gen 5 Pokemon are in the main games for that generation otherwise it'll prevent interactability between the remakes and the main games of the generation.
Overall, as what was said in the Treehouse showcase, there are now over 800 Pokemon (possibly over 900, depending on how many are introduced in this generation), all with unique animations, movesets, etc. and the amount of data used by having all these Pokemon could very well limit the potential of new Pokemon games due to the sheer number of them now. So unless Gamefreak wanted their future Pokemon games to possibly be hindered by having to make data for all these Pokemon, this was, sadly, the logical conclusion.
Possibly in the future, we'll see Pokemon games that allow us to use all existing Pokemon but we probably won't see that until Nintendo's next console after the Switch, and even then, since the existence of so many Pokemon can hinder a Pokemon game's potential, Gen 7 may be the last generation where you can have every Pokemon in a single game.
But once again, if you don't get to use some of your old favourites in Pokemon SwSh, you'll very likely be able to use them in later Pokemon games.