[semi-extrinsic]

I think it is misleading to say it was due to reduce power demands. Rather it was due to needing to cool the damned things. If you were to have a 500W TDP chip, you would either need a crazy huge cooling system or a much bigger surface area. Consumers want light and thin, so Bob's your uncle.

[lkbm]

Even if consumers were fine with big heavy things (and except for maybe phones, I don't think the CPU weight/size are an issue for consumers), light travels roughly 1ft/ns. You want fast, you have to be small.