Quite an obvious candidate because it's short and simple.
The situation with host name is a bit more complicated though. While the /etc/hostname file is only updated by the sbin/vyatta_update_hosts.pl script, /etc/hosts is updated by that script _and_ the embedded script from /opt/vyatta/share/vyatta-cfg/templates/system/static-host-mapping/host-name/node.def
I think if we stop adding a hosts entry for 127.0.0.1, no one will really miss that.