If you would ask webmasters if they would like ‘xxxyyy.com’ or ‘xxx-yyy.com’, most of them would prefer the former. There’s your reason!
If you ask them why, many of them will say “sounds/looks better”.
If you see the number of hyphenated domains, you will realise that they were far outnumbered by unhyphenated domains anyway. So, many webmasters were pessimistic about hyphenated, so they avoided it. As this phenomenon grew, obviously, lesser hyphenated domains were used in viral way.
My last name is Lengel-Zigich. When I was debating a domain to register I picked
www.lengelzigich.com rather than www.lengel-zigich.com simply because it’s easier to say
“The url is l-e-n-g-e-l-z-i-g-i-c-h all one word” than “L-e-n-g-e-l HYPHEN Z-i-g-i-c-h dot com”
People have a hard enough time remembering the hyphen in my name as it is, let alone in a URL. Although undoubtedly someone is going to register lengel-zigich.com and make it a gay pr0n site and then all of my prospects who get the URL wrong are never going to call me
As far as popular sites, there are some (as listed above). I can’t think of any others, but there are plenty more, I am sure. Not Amazon, Yahoo!, Google popular, but popular nonetheless. I believe it is preferable to not have a dash in your domain and I avoid them (I own one domain with a dash and it only redirects). But, your site can be “popular” regardless.
My partners site Learn-Guitar.net gets 1000+ uniques a day
Also the site I bought from optimus prime Learn-Japanese.net gets around 200+ uniques a day.