Because it makes many writers piss and seethe if elves are badass and able to overshadow other races (especially humans), so they have to be written as impotent assholes to one-up.
Also, a lot of settings focus a lot more on the "lost glory" aspect, so they just provide ruins and old mysteries while in the current time of the setting other races are allowed to do cool things.
It doesn't help that elves are seen as "privileged" and white-coded Many writers think Tolkiens elves are too perfect (and completely miss their narrative purpose), so they make them stupid and weak.