I'm no expert, but I have been in Baghdad since February. Along with most of the 4th Infantry Division and 101st ABN. I have seen fewer than 10 M 14s. Only one or two had optics.
I think the "reissue" of the M14s has happened mostly in the popular firearm media.
There are some practical considerations driving this as well. Off the rack 14s were like 2-4 MOA guns when they were new. They were last new in the early 1960s. Time and use (after 100 rounds or so) and arsenal rebuilcing doesn't generally improve a rifles accuracy (consistency.) Additionally, the support and maintenance systems for these rifles was discarded, again, in the 1960s. You need spare parts for combat weapons, and these are largely not in the system. These are problems that you (and I) don't generally have to deal with when dealing with our M1As.
Also, the Army went to a bolt action sniper system (the M24), because it is so difficult to keep M14 based precision systems (the M21) match grade accurate.
Penetration is a questionable argument. I've seen the much maligned M855 (green tip) go through 5/8ths of an inch of steel at 500M, out of a 14.5 inch barrelled M-4. The same piece of steel was un marked by M118 Special Ball match ammo out of an M-24 (24 in. bbl. 7.62.).
The vast majority of the patrolling in Iraq is done from vehicles. Working in and out of a HMMWV, Stryker, Bradley, whatever, is infinitely easier with an M-4, or even M-16, than with an M-14. Especially when wearing armor.
Lethality at exended ranges is also a generally meaningless argument, since 1) Most engagements are taking place inside 100m, and 2) Every vehicle has one or more M-240s, MK-19s, or M-2s (50 cal.). Very few long range targets are being engaged with individual weapons, snipers being the exception.
Finally, it should be noted that the Marines, who, on average and across their service, tend to shoot better than the Army (man, it hurt to say that), are not issueing M-14s, they are issuing flat top M-16 variants.
I think M1As are popular because they are cool guns that people like to shoot, and they are getting a lot of good press. The fact that the press about their battlefield use is largely erroneous doesn't stop it from being widely read.