You guys also forget that the dungeon was never a priority. I can imagine Larian forgot about it entirely hence why they never wrote an update about it.
As someone else said it was a prominent stretch goal, they even made a Kickstarter update devoted to it last year.
Obsidian did the same thing with their Endless Paths dungeon which will be 13 levels. And I'm sure people would throw a huge fit if they decided to cut it out of the game.
Anyway I'm at least glad to now know the reason for its exclusion. The game is still awesome.
