Kademlia uses cryptographic hashes which means similar things will have very different hashes. This is good for encryption but we're not doing cryptographic here.

Picture a file consisting of two blocks. The user will probably want to get both blocks. Since they have very different hashes, the client will find two very different paths through the peers' routing tables only to end up at the same target peer hosting the file.

A locality sensitive hash would have similar hashes for two blocks that are similar in some way, e.g. belonging to the same file, and so the discovery paths are very similar if not the same. Discovery for one block can be reused for the next. Same with blocks that are similar in another way e.g. one is a newer version of the other.

As for the project maxing out the ideas, as of late they have introduced pluggable routing mechanisms in Kubo. I think that's acknowledging that the DHT routing isn't great, at the same time not providing any alternative. Instead the user is invited to come up with their own routing plugin.

It's a bit disingenuous, like providing an on-ramp for a highway and then asking you to build the highway.