[ecdavis]

It's restrictive in that it requires your content to be rendered as a continuous stream of text. That sort of rendering is not suitable for all text games that could be considered MUDs. It's not even all that suitable for the more popular MUDs that still exist.

Now, this is not a hard requirement of the telnet protocol, for sure. ANSI controls exist, as do various sub-protocols, but support for these is mixed across telnet clients and therefore can't be relied on (unless you're willing to say your game can only be played by a subset of telnet clients, I suppose).