First of all, it does not "just happen" to be selectable. RAW contains information that is not available in a JPG or PNG , but which is crucial to a lot of serious photographers.

Second, the native raw images do include a ton of adjustments in brightness, contrast and color correction. All of which gets lost when you open the image file with apps provided from other companies than the camera vendor. Eg. open a Nikon-raw in NC Software and then in Lightroom. Big difference. Adobe has some profiles that get near the original result, but the Nikon raw standards often are better.

So DNG would absolutely be an advantage because then at least these color corrections could natively be implemented and not get lost in the process.

Noone is disputing the advantage of RAW. I tried to provide the view from a pure development perspective, looking at a feature backlog.

It "just happens" to be selectable because it is a byproduct of the internal development: The existing RAW format is used internally during development and tuning of the product, and is implemented to work with vendor-internal processes and tools.

Supporting DNG would require a SEPARATE development, and it would still not replace a proprietary RAW-format in the internal toolchain.

(because the DNG patent-license comes with rights for Adobe as well as an option to revoke the license)

just encoding to DNG wouldnt do that. nikons software has its own profiles and stuff that it applies, and they would need to publish how that works. But that is generic, you could(nikon permitting) apply their processing to a photo taken by a canon. it has nothing to do specifically with the NEF format

most people who shoot RAW don't care for the in camera picture adjustments so don't care if RAW shows up looking what it did in the camera because we apply our own edits anyways, if we need something like that we shot jpeg