It's not the default because things like 'find | grep foo' wouldn't work as well: the output would appear all concatenated, as the terminal doesn't break lines on null characters.

I wrote a utility I named print0, which simply converts line-oriented input into null-terminated output. Very useful for building pipelines of line-oriented utilities, where each line is a filename. It's quite common to have spaces in filenames (if nothing else, user files on NAS shares), and vanishingly rare to see newlines, so I find it to be a sensible tradeoff. Things like 'find | egrep | sed | print0 | xargs -0' work as you'd expect.