One of the most important features for cash is that it actually be accepted widely, and if I recall, that is a significant problem for $1 coins. I expect the majority machines that accept cash don't accept them, and trying to use them with a cashier is likely to result in amusement or confusion at best, rejection as a very possible outcome, or even accusations of fraud. That there were few instances where an individual would ever get these in normal activities probably made recognition and use even worse, especially as the instances I cam remember often seemed like attempts to push them inconveniently; I seem to remember that some government machines, I think in post offices, would insist on giving change with enormous numbers of one dollar coins, which would likely generate some resentment for users expecting change that would actually be accepted elsewhere.

It likely doesn't help that the design is rather large, eg, it is wider than a two euro coin and almost as heavy, and that one dollar notes are still being produced. For some reason, the US seems far less willing to be decisive in these changes.