Everyone (talking about non-technical users here) won't understand why they can't message a particular person any more and will blame WhatsApp "It's broken again". Block by default would kill growth and they don't want that.
Maybe a lot would it turn it off, but its better than the current situation because everyone would know exactly what they're getting themselves into. Most importantly, the people who are most at risk would get a chance to understand the issue and leave it on for their protection.
