Something like the Model S is perfectly fine for a hatchback for me, but you can't make the same design work on a smaller car like the Model 3 without other big drawbacks.
And it's not like the Model S have great headroom in the backseat.
I would also guess that the Model 3 will be VERY popular for Taxi purposes, self-driving or not. Sacrificing trunk space for headroom in the backseat seems like a smart move for that purpose.