In OSM, accuracy to the real world should always be prioritized over readability of the map. Mapping style over accuracy is called "mapping for the renderer," and there's more explanation here: https://wiki.openstreetmap.org/wiki/Tagging_for_the_renderer . OSM is a spatial database that can be used by lots of different software, so making it look good in one might break another. So as a standard, we make the map as accurate as possible to reality, and let the software figure out how to do things like place labels.