Personal Loot doesn’t make any good sense because D2 Resurrected is a Remaster but not a Remake of D2 (LOD).
Well, please notice the level of competition in Diablo. It lessened from title to title more and more. I bet, as it was for me, Diablo 3 was not much fun because there was no spark of excitement in it in ways and means of the play with other players. D3 felt so systematic especially in later days of the game (seasons).
Personal loot is like going to cinema and watching a movie for the purpose of the enjoyment for everyone in the hall, so seen in Diablo 3.
Public loot is like going to cinema and watching a movie for your very own purpose of enjoyment. That is Diablo 2.
Whether the one or the other site is in fact good or bad is not important at all. But you know, going to cinema and to get the best excitement from the movie was a part of enjoyment, too. Getting the best seat, being close to the toilets or refill, make it so that neither the lovers nor the bliges are close to you, and so on. And even if you didn’t get everything you still get something from the visit.
In Diablo 2 if you don’t want to share loot you going to build up MF-characters that can beat bosses on 8 players on your own. That was part of the Endgame, beside PvP and Hardcore mode.
All in all, i think most players want to play D2 Resurrected because they want to play Diablo 2 but not as a prequel of D3. Older people want something they know and had fun with already. Just look at WoW. Retail and Classic are whole different games. Same goes for Diablo.
Beside, killing the bots is the more important issue here. Public or Private Loot dosn’t matter if the bots (LOD) or dubes (Classic) mess up everything. Doesn’t make much fun if your ultra rare loot is in the hand of half the other players.