One interesting point in the original post, largely overlooked so far.
Unable to get a traffic service due to traffic density.
Okay, I accept, this makes life difficult for the controller. But, why pray tell, would we ask for a traffic service? Surely where we're concerned about not seeing traffic ourselves - which either means marginal visibility, or high traffic density (or both). Most pilots are unlikely to ask for it in other circumstances, since the extra pilot workload is otherwise unwanted.
So, it's being declined in one of the two circumstances where it's most likely to be useful. Yes, absolutely, it's difficult for ATC to do this but the refusal is arguably providing a significant safety degredation.
G