I suspect like most bad ideas, these shell encased lug nuts were probably a cost cutting deal.
The actual lug nuts are undersized slightly, which probably makes them cheaper, then they get encased with thin stamped stainless steel shells, so there is no chroming costs, and they look great before they get killed and holding the wheels on. There would be no warranty issues because any damage could be blamed on improper torque, and there would be no way to disprove that. If they saved a penny per lug, look at the annual cost savings in a year for just the number of vehicles with those lug nuts. These shell nuts started showing up in the late 70s or early 80s. That would be a pretty big pile of pennies in each car company's pockets.