We’re currently working on defining a compact mode experience. I will post more details when we have more to share.
Lets not beat around the bush and state the obvious: This resistance by Microsoft to change the space wasting design is probably due to some internal directive to that makes the Touch experience the primary requirement.
Teams as it stands is not designed for your traditional kb+m user, but Surface users. You can see the same thing with the recent Outlook re-design (increase in useless whitespace, BIG buttons).