Yeah, I doubt the problem was a limited number of hair. Like you said, they should have scrapped the more redundant ones if that was the case.
And, if the hair "space" was limited, they would have taken out the balding styles and put something decent for females. I think they just where out of time for modelling. But after six months, they couldn't complete something of what they had (like the gray portraits hair, or the old Josie style) and put them in the Black Emporium? Or at least, like, answer decently on the matter? is quite obvious people don't like the option they gave us. (of course, maybe read the forums sometime would help, devs! or at least letting us know you understand this is a problem for many!)
I still can't capacited myself the idiot who don't like Cass got more attention than all the fan that posted and created for months treads and made pages and pages of comments. I'm never going to do those idiotic things like that crazy guy, but really, is a little disappointing. 
Still, is quite ridicolous. Most company would have jumped in a moment at create new outfits and hairstyles/eyebrows/beards if they knew people would have been temped to buy them. BioWare is the only company I know who refuse to do something like an appearance pack 