Hushmail Backdoors
themonetaryfuture.blogspot.co.uk
themonetaryfuture.blogspot.co.uk
For the same reason that people choose Facebook web hosting over their own privacy protected servers. They are not tech savvy and know little to nothing about security. They don't even know what keys are. 10 years ago, they just knew that Hushmail offered encrypted email. It was the first service anybody heard of that did that. The non-tech savvy crowd is the niche that services like Hushmail exploit.
What is more interesting is what the EULA said about this sort of thing and if they hand data over without notification to the owner. I suspect that they did.
If you have a use case for using content signing and encryption, using a closed-source Java or other web applet is a pretty weird way to address it.
Now it's time to put pressure on Microsoft to implement two-factor authentication and native PGP support.
Of course you could also install Thunderbird portable on your USB drive and implement your suggestion as well.
Lots of reasons. If encryption is ever to become widespread, it needs to accomodate the myriad of situations that users might need computing/communication in. Which is a lot.