Headhunter when it came out was a 30C item. Back then the game was far different and HH felt perfectly in line with the type of game play of PoE at the time.
It gave a lot of attack speed/damage/extra phys as elemental along with stuff like Shroud Walker... that got you instantly killed if you didn't build your character around certain mechanics. Rare monsters could spawn with elemental or physical reflect, you could one shot yourself. It was a high risk, high reward item.. certainly in line with PoE item design.
HH is actually not that good in slow, non elemental capable of builds. It doesnt work as well on ED Contagion as it does on Tornado Shot. It's also worse on certain maps versus others and very dependent on mob types and density. Back then there were far less ways to juice up maps.. basically just Sextants and prophecies. Now we have Scarabs, Elder/Shaper influence and more powerful league mechanics that add even more rare enemies to the map.
Speed of characters has been steadily increasing over time as well. Before Raider was considered the fastest ascendancy.. Now you have Deadeye and Gladiator who cam be faster than the entire Ascendancy of Raider with just 2 Ascendancy nodes. So characters are faster, skill balance has turned up skill power level (look at current Cyclone vs old Cyclone) and maps are denser ever since the Atlas rework.
But really the tipping point started with Breach IMO which started to greatly emphasize clear speed and killing rare packs fast. Breach added lots more mobs to maps which further increased the power level of HH. At this point HH was still a risk but the main thing is that Breach was the point where players started to play way more softcore vs hardcore. With reflect immunity items you can by pass the drawback of HH and take the occasional shroud walker death too if you were in soft core.
Legacy league compounded this further. Now you could juicy up maps with Beyond plus Breach and other non sense for huge HH buffs. Sextants were really rampant and you could actually get TRIPLE BEYOND maps (legacy stone, Sextant and on map). Because league mechanics were everywhere and we had time reliwuary keys, hH were still fairly accessible though still expensive (I remember HH being more expensive than skyforths but not orders of magnitude more).
Then came Harbinger league with the 10 Acts. Harbinger introduced t16 Beachheads which you can imagine gets exploited by HH even further as the end game encounter of Harbinger was nothing but fighting a crap ton of rare monsters. This league also introduced Pantheons which allow you to further mitigate the reflect drawback of HH. I believe we also had some Ascendancy reworks here which further increased the power level of characters which just helps HH even more (either this league or next league they reworked Ascendancies).
In abyss league we had the Atlas rework which meant more density and juiced up maps. Abyss itself also spawned a ton of rare monsters. So all these league mechanics are starting to pile up. You could encounter Abyss, Breach and Beyond in a single map super juicing up HH.
Bestiary, Incursion and Delve all had tons of rare monsters. Delve was made a joke with HH and Zerphis Heart. Around this time they also removed reflect damage from regular maps, essentially removing the last gate keeper for HH and at this point HH demand just kept going up. Incursion had the powerful Vaal rework so now you could more easily clear packs by tapping a single button. Somewhere along this time we also got Solstice Vigil which allows players to have HH buff for longer and also use self curse Temp chains (popular strategy in delve).
People remember the tough unique syndicate members from Syndicate but many Syndicate encounters also spawned a ton of rare monsters to juice up HH. But Syndicate more specifically added superior bench crafting system (increasing power level of HH) which allowed certain affixes to really synergies with HH. Scarabs also made HH out of control for obvious reasons though by this time they had also fixed Sextant blocking and limited Sextants on the map (you could still attain similar densities but less consistently). Also Pure Breachstones were HUGE for HH.
Synthesis was an awkward league but synthesis items are potentially busted for HH builds. We haven't really optimized it yet because Synthesis isnt going core yet but there may be a time that something outrageous comes out of it for HH.
HH became godlike for two things at this point. Power leveling to lvl100 by farming high yield encounters like pure Breachstones, Beachheads and juiced up maps. Making more currency of course by playing faster. However up until this point HH didnt give you more yield per instance run versus someone not running HH... you just did it faster.
In legion, the power level of HH is at its peak. More ascendancy reworks mean faster characters and stronger skills as well like Cyclone. The final league encounter involves many rare monsters and the encounter doesnt drop a set amount of loot... It's only limited by the speed of your build. And in speed... HH is the one true God. When optimizing for Legion 5 way fight... you aren't optimizing your build you are optimizing HH for max rewards. Solstice Vigil, self curse temporal chains combined with massive curse effectiveness from new Timeless Vaal jewels allows you to have near hundred HH buffs on you. It's gotten so ludicrous that players have to play on ultra wild screen just so they can see their character and the loot reward bar (because on normal monitors it only displays 5 bars of rewards). This has now created the biggest divide in haves versus have nots and has warped the entire game economy around a single item and mechanic. You cannot run a 5 way encounter without HH and hope to make profit... the market has adjusted around HH farming. Even the HH build items are warping the economy. I personally have never seem a bigger divide between prices of Chase items... you can go from 20 EX item to less than am Exalt in the same category of items.
I am harping on HH a lot but all of this applies for Inspired Learning as well. Inspired Learning is also seeing a concurrent rise in use and cost despite being much easier to obtain. The main point here is that the associated cost and negative effects of running this mechanic is far below the gains/benefits from it. It's not really decision or choice anymore... you simply must use HH/IL to make big money.
Now as to why GGG hasnt nerfed HH. Well I think it has been 3 or more instances of wherr they nerfed its drop rate/rarity. HH right now if it werent for league mechanics and div cards in readily available maps would be rarer than a Mirror. GGG has fairly inconsistent nerfing methods on items. Usually they go for a couple of leagues making items rarer then drop a savage nerf when rarity change has no impact. Happened with Poet Pens, Zerphis, Impulsas etc. They just nerfed Unnatural Instinct because it gave too much crit.. This was a 10 EX jewel so it wasn't readily available. They have nerfed Biscos Collar and magic find so many times in so many ways over time. They nerf skills and mechanics left and right, regardless of rarity or availability. One of the biggest changes was when they nerfed Atziris Acuity (a 40 EX glove) because instant leeching was too good but they kept instant leech on a 1 chaos unique claw (so the mechanic can still be abused).
The reason why HH remains as is because of two major reasons:
*GGG likes having chase uniques. This one I find a bit incongruous because I mentioned numerous chase uniques that were powerful but rare yet got gutted. Also constantly introducing powerful crafting methods and stats on rare makes many chase uniques even obsolete. So many weapons are rendered useless because they can't compete with Fortify 2h swords or dual Foils.
*Headhunter has become too iconic and too many players have gotten a taste of it. HH is a very fun item and once you go HH its hard to go back. GGG rightfully fears that a nerf to HH would be received poorly by the fanbase. I can't tell you how many times Cutedog has threatened to quit the game over potential HH nerfs lol.
This league GGG made nerfs to the game based purely on performance issues. They gutted Elementalist because proliferate was hurting performance. IMO this feels way worse than a nerf to HH because its such a core part of a class. Yet HH has similar issues as prolif... bigger ones in fact. This combined with the Timeless Legion mechanic... I have a feeling we may finally see a HH nerf. It's not really feasible to make HH even rarer, it just exacerbates the issue.
There are many ways they could nerf HH yet still keep it as a powerhouse and fun chase item. One is that they introduce more negative Rare monster affixes. Stuff like "Pulverize" but it impacts character action speed. So you are 10% slower but hit 10% harder. Or "Glass Cannon" affix, you hit harder but have less HP. Or the reverse where you are tankier but do less damage.
Another one could be that you can't steal the same mod type again. This would prevent many issues with HH like your character becomes bigger than the map you are playing in.
The one that commonly gets suggested is cap on the stolen mod amount. Honestly there should be a cap on numerous other on kill effects not just HH (like Eshs Mirror). This would also fix the issue of stacking 3 inspired learning and HH to accelerate rate of acquisition.
Or to be honest its not even a HH issue its a league issue. Maybe GGG reworks the encounter when it goes core... But that's just lame. It was super cool to have a mechanic in the game that rewards you more for min maxing your build more. I could see GGG implementing a Respawn limit or a loot limit on timeless encounters in the future though but having a league mechanic be balanced around an item is just plain out of line to me. I dont want GGG to be forced into balancing leagues around a single item, it just limits design space.