The answer is "it depends". Japanese game developers used to almost always build new engines for games, which became problematic during the PS3 generation of game development. Demands kept increasing for what an engine could do.
That's still true today, to the point game developers use Unreal or Unity. Or are part of a larger company that maintains their game engine.
So for a retro or smaller scope game it's usually a reasonable choice to make a unique engine for each game. But for large scope games like Baldur's Gate 3, it's been fruitful to stick with an engine that has a long life cycle.
I doubt most of the contentious points with the current state of the game can be in any way blamed on "engine limitations" to begin with, frankly.
This is very true, UI, party controls, and design choices have so little to do with game engines in 2020.
The reactions example, it's probably always been doable in the current engine. But Larian as a design choice did not want reactions to slow down combat. (There's an early interview on YouTube discussing it). Enough players have expressed their opinion on the other, and Larian wants to make the right choice with reactions to appease the player base.
Readied actions are rarely brought up, relative to all the other game critiques. So they're probably a low priority.