> ICANN isn't the DNS police

ICANN and IANA very much are the DNS police. As a matter of fact, IANA maintains a list of special-use domains - though, despite its widespread use, .lan is not on the list - and these domains will get rejected from gTLD applications outright. The last thing I want is to require each recursive resolver to have their own idea of what should and shouldn't be resolved.

On a related note, Google owns a registry (CRR) and a recursive resolver (8.8.8.8) that's commonly used by default or as fallback. Letting them ban entire TLDs would be a massive conflict of interest.