I understand, but there are a few points I'd like to make. Firstly, fantasy is often seen as set in a certain time period, around Medieval to Renaissance times, but often also features races that can live to be very old, and very old worlds. Regression can then be an explanation to reconcile these different factors, so long as there is a good explanation.
Also, a fallen hyper-advanced ancient civilization means ruins to explore, frought with dangers, potentially what caused the collapse in the first place. It means that the story will reward characters for exploring and going into danger with powerful artifacts and lost magical knowledge, rewarding danger and other exciting things to read about. It's a more common and popular type of story than one where to gain more power you-! Study. Experiment. Like science in the real world.
Of course there are stories where the protagonist studies magic themselves to become powerful rather than hunting for lost secrets, The Reincarnation of Alysara is a wonderful example of this, but it's far less common, because a lot of people like the more adventure-y kinds of fantasy, it's what they're used to, and ancient advanced knowledge/technology is a real easy way to reward characters for doing that. Especially when you're not using a litrpg style progression system.
Another thing is, 'old' is often synonymous with 'rare', and people tend to have the idea that rare=better, so that's how they shape their worlds when they write.
That said, it is a bit of an overused trope. And the old-world low-technology problem can be solved via other means, like old races being slow to change, magic advancements are horded and kept secret by those in power and thus progress is slow because everyone keeps the knowledge they find to themselves, etc.
And it makes more sense when it's a sudden loss, not a gradual one like you described, yes. Because society tends to progress over time, people are constantly trying to find better ways to do things, solve problems, use less effort to solve old problems, etc. If something is worse, it gets left behind. So to regress, something big needs to happen that wipes out either the knowledge of how to do the advanced thing directly (the death of everyone who knew how, and the destruction or loss of any records on how), or the resource required to apply that knowledge, that would then result in the natural loss of that knowledge as it becomes irrelevant. That could tie in to a massive regression too, if all of society had advanced so far that they forgot all the basic knowledge/skills required to reach the point that they had risen to, only for something to happen that makes their current level of technology useless, and having phased out all the old tech and know-how, they have to build back up from 0 again.
