There are two reasons bettas are kept in small spaces. One they live in rice paddies and don't need a huge area. Many are farmed in pint whiskey bottles. This is even more true when they are in a temporary situation. While they don't need a ton of room the bigger issue in chain stores is they aren't providing good water quality. Water changes and stable temp are what matter more. Ideally you wont hold bettas in a retail environment for more than 2-3 weeks if you are marketing them well and ordering correctly. Then the hobbyist can decide how to care for them long term.
I hate to be the one to bring this up, but the other reason is retail space is extremely expensive. You need to get every dollar per square foot you can out of your store. You will not hold nearly as many fish on a shelf using large bowls. Like it or not retail is a business and it cost a lot to run. Rent, labor, water, electricity, equipment, insurance, taxes, and inventory all add up. You do not want to be the non profit LFS in town.
If you do want something with recirculating water I think proclear aquatics came up with a good compromise. You can watch a video about it here. It is also a great way to market nano fish and shrimp that get lost in other retail settings.