Remember these were for library cards and other short content. There are fixed time costs of loading and unloading from a typewriter which may negate some/most of the speed advantage, and using a typewriter may also bend the cardstock over time. And finally, typewriters were expensive machines.
While there is a sunk cost fallacy, your sunk costs do determine future costs. If you've already sunk a thousand hours into penmanship so that it will only take you another ten to learn a new style, it's a better investment than spending a hundred on learning to type proficiently.
As I understood, library hand would be something taught in a librarian course. It could be used at any library that an aspiring librarian would end up working at, but only a handful of libraries would be implementing a typewriter system for the library cards.
Right, but the article didn't say "They couldn't afford a typewriter", it said it would take too long to train them to use it. It's surprising to me that it would take longer to train a person to use a typewriter than it would to learn to write in this type-like style.
Time and willingness. The people you train to use a typewriter aren't just learning to type but how to provide limited service and maintenance to the machine, which, besides being another responsibility to take on, didn't fit with some people's idea of what a librarian should be doing.
Perhaps you know of a machine like this in your own life, but some typewriters spent as much time broken (ie- no one present knew how to fix, even if it was a simple jam) as they did being usable. And since you could only train one person per machine at a time, either you'd have to send people off for classes (not guaranteed to be on the same model) or limit access to them based on who was willing to become the local typist.
Penmanship is fairly social and a skill many would have already had and prided themselves on. 'Make your letters this way' is a simpler request then than 'learn how use without breaking this expensive and delicate contraption that's more trouble than it's worth'.
I don't know about the practical reasons but "learn to write like letterpress printing" is a pretty dehumanizing instruction. Which was apparently accepted.