My own feeling is that they just didn't believe it would sell, or else they feared some effect on the company's reputation for making an unlicensed game on a zombie console. Maybe some uneducated 360/PS3 players would have said shit like, "Man, this game could be ported to Dreamcast? The graphics must suck!" and KFF chose not to risk it.
But on the plus side, they really did consider it. This should get all of us to rally around more games for possible ports to DC! In fact I already see a contender... I might start a thread for it soon.