A good cotton tent is expensive, but can be very good value as they last a lifetime and are childproof. In The Netherlands, families may camp up to 5–8 weeks per year, car camping on campgrounds in western or southern Europe. They quite often have cotton tents, I'd say they are the majority of quality family tents on those campgrounds, such as in the pictures below.
During my childhood, we always went camping in summer, for up to six weeks in a row, using a bungalow tent, with the kids sleeping in a cotton tent somewhat similar to the pictures below (only a somewhat cheaper model). Only in adulthood when I started backpacking, did I first learn about the problem of condensation — there is no such thing in a cotton tent. Synthetic tents are really only needed if you carry a tent on the back or the bike.
Consider a stereotypical image of a French campground in summer:
Source: Camping le clou
Or at the coast:
All the tents you see in these images are cotton.
Cotton is a more durable material, it is stronger and thus more weatherproof, it breathes naturally, it doesn't look soggy when wet.
(Incidentally, in my family we call the type of erecting the tent seen in the second image — with the opening away from everybody else — De Waard style, after the brand of tent pictures; a rather introvert way of camping!)
There are advantages of a synthetic tent:
- Much lighter and packs more compactly — essential for backpacking or when flying to holiday destination, highly desirable for bikepacking or taking the train to holiday destination.
- It's cheaper — when only camping for 2 weeks per year, families might not want to spend €3000 for a tent. In The Netherlands it is quite common for families to camp for 8 weeks per year. Spend 8 weeks per year camping for a tent that lasts 20 years, and a €3000 tent is less than €3/night — not bad when it sleeps 6 and is large enough to stand upright (at least for children) and play monopoly on rainy days.
From your question, I deduce that in some parts of the world, such tents are not popular even among families car camping. I would speculate that such families are either in caravans, campers, or "glamping", or perhaps not willing to spend the money for a cotton tent. The market probably relies on families having long holidays. Which is consistent with the other answers referring to scouts: scouts do spend 8 weeks per year plus in their tents (I think), which makes the expense worth it. Families who can only go for 2 weeks per year (USA?), not so much.