Quite right. Who in their right mind in 1936 would buy a reproduction of a 1917 car over a 1927 car let alone a 1934-36 car.
And a 1917 car with very well known problems.
But that is what the British did. Ignored almost 20 years of progress in internal combustion engines out of the 40 (ish) year history.
The first British Cruiser Tank to use the Liberty engine was the Mk.III. Its origins lay in the US T3 Medium tank with its Christie suspension & Liberty engine.
The Christie M1931/ Medium Tank T3/ Combat Car T1 was the first of Christie's tanks to be accepted for production by the US Army, and was used in small numbers by the infantry at the Medium Tank T3 and the cavalry as the Combat Car T1.
www.historyofwar.org
So maybe we should blame the USA for using such an out of date engine.

Note the similarities between that and the A13 in the wheel layout (see below).
Nuffield acquired one such vehicle in 1936 and the patent to allow it to develop it for the War Office. In doing so they improved the Christie suspension, took the turret from the Vickers designed A9 and kept the Liberty engine to produce the A13. Only the early Liberty engines were imported from the USA and they were modified by Nuffield with new carburettor systems. As that was before Lend Lease they would have had to have been paid for in full (whatever pricebthat was). Nuffield also acquired a licence to manufacture the Liberty engines used in its tanks at least from the Crusader onwards. That involved a redesign to reduce its height by relocating certain ancilleries and then changing the cooling system as well as a power increase.
(The preceding Cruiser Mk.I & II tanks, the A9 & A10 designed by Vickers used a 150hp AEC petrol engine and weighed 13 & 14 tons respectively.)
The A13 Cruiser Mk.III weighed only 14 tons. 65 built in 1939. Then the weight grew. A13 Mk.II/IIA Cruiser IV/IVA 14.75 tons. 272 built late 1939 to early 1941.
A13 Mk.III Cruiser Mk.V Covenanter 18 tons broke the mould, keeping the Christie suspension but using a 340bhp Meadows DAV flat 12 engine. Hull designed by LMS (a company with no previous tank design experience) & turret by Nuffield. Nuffield own designs had been rejected and cost played a part. It proved completely inadequate for a whole variety of reasons and was used only for training in the UK. 1,771 produced from 1940 to mid-1942.
Nuffield didn't want to build Covenanter so developed the A15 Cruiser Mk.VI Crusader, continuing to use the Liberty engine. Weight now 19 tons. 5,300 produced late 1940 to 1943.
Then the designations and development get complicated with the "Cromwell" tank. 3 versions all of which look outwardly similar but in reality weren't internally.
Cromwell I - A24 Cruiser Mk.VII later renamed Cavalier powered by a 410hp Liberty development. 27 tons. Built by Nuffield who didn't want to use the Meteor. 500 produced in 1942. Training use only.
Cromwell II - A27L Cruiser Mk.VIII later renamed Centaur powered by Liberty engine.
Cromwell III - A27M Cruiser Mk.VIII later renamed Cromwell with the Meteor engine.
The Tank Board worked with Leyland from Oct 1940 to look at installing what became the Meteor engine in a tank (a Crusader hull being used initially for engine trials). BRC&W were brought in alongside Leyland due to a lack of design capacity at Leyland. In 1941 Leyland began to have doubts about cooling the Meteor and the fall back was an improved Liberty engine. So in 1941 there was a reorganisation.
A27L with a developed Liberty engine under Leyland design leadership effectively as a fall back in case Meteor didn't work out.
A27M with Meteor under BRC&W design leadership. Sorting the cooling took some time.
It was early 1944 before a "Final Specification" Cromwell IV (nothing to do with the I/II/III designations noted above) was ready with sorted engine cooling, suspension, gearbox & 75mm gun. They were issued to 7th Armoured Div and the armoured Recce regiments in the Guards, 11th & Polish armoured divisions ahead of D-Day. Some Centaurs did make it into service in NWE in 1944/45 mostly in secondary roles.
The twists and turns with the development of the Centaur / Cromwell line are well set out in the Wiki article which draws on the best of sources. Be warned! It is not an easy story to follow!
en.m.wikipedia.org
Edit:- note the British Infantry tanks (Matilda, Valentine & Churchill) used a variety of other petrol & diesel engines and not the Liberty.