Because when every person reclines, as usually happens whenever meals are not being served, there is the same amount of space between each seat, but all the seats are in a more comfortable position.
>> "Because when every person reclines, as usually happens whenever meals are not being served"
I have never seen this happen on short of long haul flights. Unless is it night time the vast majority of people tend to have their seats upright. From what I've seen the reason is simple - in flight entertainment in on the back of the seat and most people want to watch a movie.
"Comfortable" is subjective, though. While there may be the same distance between seats when they're all reclined, the change in the shape of the space is enough to make a previously workable arrangement impossible because, and here's the remarkable bit, people are different shapes.