Upper Hutt is simply too far away from the main population areas.
Living in Porirua, that would be a complete pain in the bum to get to. Lower Hutt at a push would be acceptable.
Also the Hutt has about a third of the region's population so I'm not sure what you mean by main population areas. It's obviously not as central and convenient for everyone as the location of the current stadium but there's no way they're going to build a boutique stadium in Wellington City, the land just isn't there and it would cost way too much. Upper Hutt wouldn't be be significantly more inconvenient for more people than any other location in the wider region. Upper Hutt is also growing fast and has more room for new development than other areas so its proportion of the region's population is only going to increase
you either stay playing in a massive 3/4s empty oval bowl that's not fit for purpose or you shift to an appropriately sized and shaped ground which is a bit harder for some to get to. You can't have both.
Obviously I'd prefer if it was Upper Hutt but if they built a boutique stadium in Porirua or Kapiti I'd still prefer that to the status quo