I have no definitive proof of this, and I have asked a few former Masters, but I think it was realised QE2 probably shouldn't have had large windows at that level / height looking forward as they originally did in the Observation Bar. So a Bar / lounge could have been reinstated but the windows would have been much smaller and that defeats the whole point of an Observation Bar.
I have also come to the conclusion, again with no definitive proof, that the block extension helped strengthen the whole front superstructure.