I'm not familiar with the purposes or history of machine-id, I'd guess that it's just a legacy artifact that can't be easily removed now.
There's definitely a lot to be desired when it comes to privacy on Linux. Unfortunately Linux was designed before many of the privacy and security best practices became established, which is why is it less secure than modern systems like Android (source). Trying to re-architect Linux at this point would be an insane undertaking. Machine-id is just one thing in a long list that would need to be changed. Nothing wrong with advocating for it, but I just wouldn't expect it to happen for at least 5 years.
Containers are a modern technology with isolation and security as a core goal from the start. And by now, containers are already deeply integrated into the Linux community, for example look at how the entire Fedora Atomic project (including Bluefin, Aurora, Bazzite) uses container-based infrastructure to build the OS images. So that's why I've been moving towards it as a solution for my privacy needs, and I recommend others look into it as well.
Edit: rewording some sentences