Streaming has become so mainstream and prioritized that for many people, the option to watch, much less own, physical discs isn’t even really an option to them. The idea that there’s a big enough number of people who would buy physical releases of the show instead of streaming them doesn’t seem realistic to me, I agree. They wouldn’t lose money if they issued this series on blu-ray or 4K UHD.
For better or worse (largely worse if you care about things like picture quality) the mainstream audience considers streaming to be the primary home video format now, and prefer to watch their shows via the internet. The discs wouldn’t be competition with that. They’d be a very cool secondary income stream for the property though, and they should exploit that.