They chose to use a perfectly functional TV chip. There was no reason for them to think that they needed to use a Macrovision-approved chip at the time. The chip they used worked, people could watch DVDs, and it's worked for quite a long time, until nvidia changed their drivers. No video card maker ever would guarantee that their card will always work with every single version of drivers that someone else makes. They provide you with a functional set of drivers and software. If you choose to use something else, you can't complain that it doesn't work and blame the card maker.
Having a TV chip that isn't Macrovision approved and one that doesn't work with Macrovision are two different things. Macrovision has forced or paid nvidia to not allow non-approved chips in the drivers, because the non-approved chipset can't be guaranteed to provide the copy protections that Macrovision wants. That does NOT mean that the chips won't play Macrovision protected DVDs.
If you want someone to blame, blame Macrovision for forcing nvidia to change their drivers to disable people's legitimately purchased devices and disable legitimate usage of those devices. Macrovision is only interested in enforcing what they think should be allowed to be done with DVDs. They could perfectly well have just mandated that future cards must comply and have the drivers enforce that, but instead they've decided to disable every device whether the user had a choice or not. Blame nvidia for their drivers if you want. But the card makers should be the last to blame.