It's worth adding that the proposal was mainly for reboosting the telescope, which can still be done later if needed.
Trying to EVA and work on Hubble would be very risky right now with Dragon since you have to vent the entire capsule first, and this creates all sorts of optics contamination risks.
They're also balancing this against upcoming technologies, possible cost reductions and the much improved capabilities of ground based telescopes due to advanced adaptive optics.
They could, but it might be considered risky or maybe outright not possible with the current design, since the EVA hoses would be different from the ones normally used within the capsule.
It isn't that the problems can't be solved, just that NASA doesn't think it's worth working on just yet. Tbh I wouldn't be surprised if they're hoping to get government funding so that they can be the controlling party (vs a private mission, where, ultimately, they have to compromise with the specific things Isaacman would be willing to fund and within the timeline within which he's willing to keep funding).
Trying to EVA and work on Hubble would be very risky right now with Dragon since you have to vent the entire capsule first, and this creates all sorts of optics contamination risks.
They're also balancing this against upcoming technologies, possible cost reductions and the much improved capabilities of ground based telescopes due to advanced adaptive optics.