this is the tradeoff that schnorr gives you: no signature malleability, the pubkey X is like a malleability protection. the pubkeys must be in the spend transaction along with the signatures on the out-points being spent. so they are not so much smaller in size than p2pkh transactions actually. in fact slightly larger

I believe Schnorr could not have been used at the time due it being protected by a patent, which seems to have expired only in 2010 according to Wikipedia