Captain, whilst you are correct in the advantage of being fretless means the player, if skilled enough, can play in any temperament they choose. However, in my experience in the UK most folk musicians play instruments that only play in equal temperament and only a tiny minority have the desire to change their instruments to another. So, for most occassions a fretted fiddle would do fine.

Also a drawback of being fretless is it would be much harder to accurately finger a chord which is why guitars, banjos etc have frets.

Being fretless also gives the advantage of being able to do the "classical" vibrato (again something that is rarely seen in UK folk music.

I'm not advocating that fiddles should have frets but just curious about why they don't