You'd be surprised how may projects exist that are like this. But somehow template languages are always more popular and have more traction. I guess there are very few people who would rather have code produce markup than have markup allow code. Perhaps because large projects have their markup written by non-coders?
I prefer building in Markaby style. When I used to maintain a Radiant CMS site I'd sometimes need to generate content that I couldn't generate with the native tags. I'd end up having to teach Radius how to do something new. This interfered with "getting things done." Code doesn't get in your way.
Don't get me wrong. Markup/templating languages are great for 80% of what you use them for. And I especially like that they sandbox the average user from doing anything dangerous. I just felt like in the 20% scenarios, tweaking the markup language was a painful hoop through which to jump.