That would probably add a lot of extra weight and it would need to make the device bigger.
And once you have the pipeline and computation power to enable inside out tracking all on device, adding an OS is essentially free.
As for sending data over a cable, there's nothing inherently laggy about it. After all, the display signal already travels over the cable, and the cable transfer is by far not the limiting factor in latency. The camera data is lower bandwidth than the display signal, too.