There are so many reasons NOT to.
Big reason is, if you deal with fiat, then you need to get licensed, you need to get regulatory approval, you need to prepare your entire system to work with a fiat system.
Do you honestly think you could enjoy low house edge, fast approvals, fast play, and all that, while using fiat systems? The whole reason dice games and crypto games can offer much lower house edge is because of lower operational cost. Choose to use fiat and kiss goodbye to those low operational costs.
How can you say not while such thing exists in reality?
I already said, let's take for example about butstabit lkke game, absolutely same game played by fiat money is on local casino's website. They have provably fair system too and you can verify each bet + they offer jackpot in this game, withdraws take 0% fee and are immediately on your card. My example is 100% opposite of what you say, such thing exists, it even offerd jackpot and 0% withdraw fee.
Then you didn't understand what I was pointing out. Yes, fiat currencies casinos exist in reality, but as I said, you would have to do a lot more things to run a fiat gambling site for dice. Licensing and provably fair for example. Provably fair for fiat casinos are usually RNG verification, NOT self-provably fair like dice site on dice sites.
And, yes, it is possible, but I bet you your casino has a house edge much higher than standard Bitcoin dice sites which is 1% or lower.
IF you bet x2, what is your win chance? You can see house edge from there. Then you know what I'm talking about.