The answer as to why people don't consider it genocide (when they should) will depend in part on who you're asking. I'll go primarily into the historical debate on this topic, although you should keep in mind that there is a modern political dimension to this question as well.

I would say that most good historians nowadays would recognise the stolen generation as genocide, however, there has previously been debate on the subject, primarily in the 90s. This debate widely revolves around how we define genocide. Some of the arguments made by those who didn't classify it as genocide were: that genocide required total destruction and that the aboriginal people still survive, or that genocide requires official policy. There has also been resistance as some see the Holocaust as the archetypal genocide, and do not classify the stolen generation as genocide because it does not match the Holocaust. It is worth noting that this perspective is not commonly held by historians anymore, although it does still exist in the public imagination.

When considering the arguments made by these historians it is also important to note that the aboriginal people are not a single conglomerate, and are extremely diverse and aren't a single cultural unit. So while aboriginal people still survive despite the violence towards them, whole communities, people, cultures, and languages have been lost due to the violence.

However, there are other historical approaches to the violence against aboriginal people in Australia, and this approach I would say is the better one and does view the stolen generations as genocide and as part of structural systems of violence.

So basically a lot of the historical debate over genocide in Australia in academic circles has been one of definitions, and one has to ask how useful it is to quibble over definitions, especially when both sides are predominantly white and western, and when Aboriginal people are still facing the consequences of this violence and genocide today. So basically, yes the stolen generations should be considered genocide, but this historical debate, as well as politicians not wanting to have to deal with the consequences of admitting to genocide in Australia, means that it is often not acknowledged as such when it should be.

If you want to read up further on this I'd recommend 'Genocide and Settler Society in Australian History" in the book "Genocide and Settler Society: Frontier Violence and Stolen Indigenous Children in Australian History" by A. Drik Moses. It's not perfect and is a bit old, but it will provide a much more comprehensive overview of this issue than I can.

Hopefully my response answered some of your questions though, if you have any more I will do my best to answer, although this isn't the area of my expertise.