The main problem is that reified generics would be incompatible with the current collections.... The extra type information also impacts the interoperability between languages within the JVM but also outside of it.
I completely agree. I used to rail on erasure until I got more experience with it.
The interoperability issue is one big reason I now like erasure. With erased types, the interop layer uses only a very simple type system. Knowledge of complicated type systems stays within the compilers for individual languages.
An additional reason is that it puts the cost of type checking in the compiler rather than in the runtime. With erased types, the compiler works hard to do its type checking, and if it signs off, the code is known to be type safe. At runtime, the types disappear and the code runs at full speed.
This property is more than just pretty. It is very helpful to an engineer trying to build anything using the language. When you write code, you want to know how it is going to perform. With erasure, the things you write convert directly to machine code, just with extra details added such as which variable goes in which register. With reification, you end up with extra crud being inserted everywhere. To understand performance under reified types, you have to reason about this additional type crud. You'd rather not have to.