True, wouldn't have had the Max issues. Also, the 757 is capable of operating within the same runway parameters as the 737s, which makes it appealing.
There are a few things that need to be considered though. The 757 is an airframe that was aligned engineering wise to the 767, which was a bigger type and pilots could operate common type ratings, can't do that with a 737. This is important because 737s are the most common and most mass produced airliner in history. Lots of operators have heaps of 737s in service, so parts commonality counts for cost savings. Also, the 757 came in only two basic variants, whereas the 737 comes in a whole family of sizes, which means if you have low density routes you can order an aircraft in common with your medium density route operator of the same type. The 757 has a minimum of 200 seats. What if you want an aircraft with 140 seats? That's just a waste of money flying a bigger jet on a smaller route.
Airbus are the same - apart from the basic A320, you have the bigger capacity A321 and the smaller capacity A319 and A318 based on the same frame.
The basic answer is economics.
Regarding the Max issues, Boeing really needed to invest in an entirely new airframe rather than relying on legacy airframes as it has done, with the 737 Max and the 747-800 and its tailplane issues. Boeing is a household name and the 737 has been around since the late '60s, so continuing the frame offers fleet commonality as well as continuity in an airline operator and customer, i.e. pax context. In this case, this was a mistake however and the issues with the Max mean that Boeing will have to look for a replacement airframe for the venerable 737 sooner rather than later.