It's about the drive characteristic. I've driven a 3.0 v6 TDI audi A6 with a remap, and boy did it fly. However did I like it? No. Great for a motorway cruiser, as a hot hatch? Crap. It completely defeats the point of the hot hatch. Screaming 4 pot 16v petrol is far far more fun to drive and furthermore the engine is lighter ergo doesn't unbalance the car either. Also it's more rewarding, sounds nicer, and offers a smoother more useable power delivery.
I'm not denying modern diesels offer good performance, but it's the power delivery, and driving style that just doesn't appeal at all. It does NOT make a hot hatch. It makes a quick family car, it makes a fantastic cruiser - it is world apart from being a sensible engine to use in something like an old 205 GTi.