I too suspect they could have - but even if they could have, it wasn’t at all clear that it would’ve been the right thing to do. Even for Intel I don’t think it was clear for a while that their gambit was going to pay off and bury RISC (or Itanium), and there was much less incentive for Motorola to maintain backwards compatibility. A clean design that was faster - and easier to make faster - must’ve seemed like a sure bet at the time.
Intel had so much money to burn they tried at least three different strategies and the market chose the winner. Compatible with Pentium, RISC with i860, and clean-slate with Itanium are those that come to mind.
Each of those projects undoubtedly cost billions. An incredibly luxurious position to be in.
