Everything you think would be good about underground would be more easily and cheaply accomplished by building aboveground buildings that connect. (Or said another way, by effectively raising ground level to roof level without the expense of digging.)
Underground Atlanta is like this, BTW: they didn't dig below original ground level; they raised the street grid up on viaducts.
Consider the following scenarios:
You start with a hill, then dig down into it and build a building such that it has a flat green (vegetated) roof at the original ground level.
You start with flat ground, build the same building on top of it, then mound dirt up around the sides to form a hill.
Two methods to the same result, right?
But now, imagine that instead of one building, you've got an entire city worth of buildings like that bunched up touching each other (no roads between them, just interior corridors). With scenario #1, you've still got to do a bunch of excavation for each and every building. But with scenario #2, you only need to do earth-moving around the perimeter of the city (if you even bother). Still the same result, but now method #2 is much, much cheaper.
This is a very hypothetical thread, so that's the kind of issue that could just be hand-waved away as part of the initial premise. But if you want a real answer, that's easy: "zoning codes." Cities have absolutely no trouble exercising their authority to regulate building height.