FIFA obviously wants, for financial and marketing reasons, that as many national teams as possible can participate in the World Cup, and the interestingness and quality of the competition is less important to them.
It all comes down to profit in the end, as always.
I think that the fans will always be interested in the matches of their national teams, and that they will start to be interested in the rest of the competition only when the group stage of the competition is over.
It is really a shame that such a great national team, such as Italy, will not participate in the World Cup, but I believe that they will surely participate in the next World Cup, because it will be much more easy to qualify, given the much larger number of participants.
If I remember correctly, the expansion of the number of participants is carried out mainly not by increasing the number of teams from Europe, but by increasing the number of teams from other regions. Therefore, although the situation will improve, there will still be a chance that several very strong teams from Europe will not get into the final part. And the fact that interest in the tournament is falling is obvious to everyone except officials. There is no point in watching most group games, they are completely pointless.