> Also it's the year ~1980 and we're limited to the technology of the age.
Tbf the Motorola 68000 which was released around the same time (1979) had a proper linear address space with 32-bit address registers (of which 24 bits were wired up).
Also the 8086 was intended as a cheap and temporary stop gap until Intel's "proper" 32-bit CPU architecture was ready for prime time (the doomed iAPX 432).
New platforms were 68000, old platforms with legacy code just wanted access to more memory, so 8086 segments allowed 64kb chunks. A hack only usable by folks that still wanted to run their old 64kb programs.
It would be a piece of trivia today if motorola were not 6 months late which forced IBM in frustration to change tracks to Intel and MS DOS instead (which worked on 8086). That 6 month drlay created WinTel of today.
The Motorola 68000 was roughly an order of magnitude more expensive than the Intel 8086.