"Why take a chance on expensive damage to a vintage Colt over a 25-dollar part?"
No real reason, other than the collet offered enhanced accuracy out-of-the-box without having to buy and fit a custom part.
"If they're so good...Why did Colt drop'em?"
Expense.
The collet bushing was significantly more difficult and expensive to make, and did require more care in fitting the slide, barrel, and bushing.
"Why don't we see the collet bushings on high-end custom pistols?"
Because few custom makers actually make their own bushings. They buy bushings and fit them, which is much cheaper than actually manufacturing a bushing, especially a complicated part that requires careful heat treating.
Then to, a custom fitted bushing is as good as a collet type at a cheaper cost.
Among companies that did use collet bushings was Bar-Sto.
Their bushing worked differently than the Colt design, and was a seriously great accuracy enhancing design.
"Back in the day" people wanting the best bought a Bar-Sto barrel with the collet bushing. If you had a Bar-Sto unit, you were a SERIOUS 1911 shooter.