Because he could only be a warner or conveyer of message who had no power over the free will of others:

Therefore do thou give admonition, for thou art one to admonish. (Quran 88:21)

Thou art not one to manage (men's) affairs. (Quran 88:22)

The Prophet of Allah is sent to teach and direct people on the way. He is not sent to force their will, or to punish them, except in so far as he may receive authority to do so. Punishment belongs to Allah alone

Here you are the prohibition of compulsion:

Let there be no compulsion in religion: Truth stands out clear from Error: whoever rejects evil and believes in Allah hath grasped the most trustworthy hand-hold, that never breaks. And Allah heareth and knoweth all things. (Quran 2:256)

Those who commit violence and use Islam to introduce it as the religion of terror and inhuman principles don’t know this aya. No compulsion in religion says our Quran. And don’t forget: this aya revealed in Medina in the middle of external and internal attacks of non-Muslims. Christians put Jesus in the center of love and tolerance. Giving respect for our Christian brothers and the ministry of Jesus we also have to call the attention of the world to this aya which prescribes maximum tolerance and love in any circumstances.

So if they dispute with thee, say: "I have submitted My whole self to Allah and so have those who follow me." And say to the People of the Book and to those who are unlearned: "Do ye (also) submit yourselves?" If they do, they are in right guidance, but if they turn back, Thy duty is to convey the Message; and in Allah's sight are (all) His servants. (Quran 3:20)

Obey Allah, and obey the Messenger, and beware (of evil): if ye do turn back, know ye that it is Our Messenger's duty to proclaim (the message) in the clearest manner. (Quran 5:92)

And the same message here: 3:20, 5:67, 16:35

Islamic propagation today is expressed by the word "Da'wa", which avoids the essence of propagation. It rather means call. We can find the word “Da’wa” in the Quran as worship or direct call of God by the believer:

When My servants ask thee concerning Me, I am indeed close (to them): I listen to the prayer of every suppliant when he calleth on Me: Let them also, with a will, Listen to My call, and believe in Me: That they may walk in the right way. (Quran 2:186)

“When my servants ask Me, I am indeed close”. The word “Say” is not here. Not like this: “When my servants ask me, say (o Mohammed), I am indeed close”. This is a unique place in Quran where Allah turns directly to the believers. And He continues: “I listen to the prayer of every servent when he calleth Me.” Also, it is a direct call for every human who believe.

This is the theory on the prohibition of compulsion and propagation. I cannot answer the question why history and sometimes even actual events show other practices.