I'm the person who implemented the current motionblur --
Per pixel motionblur just is way too slow, and wouldn't work on some (actually quite a few) platforms/graphics configurations. Besides, you're wrong: Crysis and UT3 don't even use per-pixel blur. -- Crysis uses something fancy called per-object blur, it's how they do their motionblur, depth of field, and some parts of the bloom effects. If we wanted this in DP (I know you're not arguing for this, but still), it would require a re-write of part of the renderer

UT3 uses a mixture: it's screen based blur with per-pixel fading techniques. DP is just screen based blur which blurs the entire image all at once.
Here's the thing: The way I did it has the most support and best performance. Its biggest downfall is that it has bad results at low FPS.. If you have 30fps it'll look rather terrible, but it looks best around 70/80fps. Anything higher is good too -- Besides, replacing an already implemented feature is a waste of time when there are far more important/useful things which could be done (like soft particles, etc etc)
"The current motion blur nearly makes my eyes bleed out until death"
:'( -- seriously though, try lower values. If it's too high it looks shitty. I use 0.2 all the time with damageblur at 0.3. And if you really don't like it that much, just turn it off

It's MOSTLY used for videos anyway (though there are some players, like me, who use it all the time)