Bank bill counters can manage it with both speed and precision, and have been able to do so for a very long time. This is more of a problem with costs than possibility. They ignored the fringe cases intentionally.

The companies making the atms and other vending devices don’t care if you get frustrated, they know you will typically keep trying until it works because “that’s just how vending machines are”. the important thing is their machine is cheap, since it might get vandalized and cost them money to replace.

I feel there’s a reason most of them take cards now (it’s easier to spend more, don’t need change, machines aren’t storing large amounts of cash making them a target, and the tech is easier to have function properly for cheap, plus they can charge an extra fee!). Is not a good move, just part of the enshitification of everything.