Imagine you are an American designing a system. What about non-Latin alphabets? Yeah, these should probably be converted, nobody's going to bother with those. What about Hungarians, should we care about their O / Ó / Ö / Ő and U / Ú / Ü / Ű? And Icelanders - should we allow their Ð / Þ?
I understand that seeing your name misspelled hurts, but pretending ASCII is enough for everyone is an understandable simplification.
And yes absolutely we should bring Ð / Þ back for English use and drop those ridiculous digraphs.