More seriously, are there public examples where inventors/technologists have ever actually said "we could do this but we won't"?

A recent "popular culture" reference to the scenario mentioned in the article is the video game, "Horizon: Zero Dawn."

To reiterate, The belief that evolving machines have to match the kind of evolution we're subjected to is illogical. Machines wouldn't be there without us and we wouldn't have what we have now without evolving our machines.

We're just way more capable of high complexity.

But also don't forget that evolution is not determinist : although you are probably right that silicon based life cannot exist, it's not because it doesn't exist that it is impossible

What are you even measuring with complexity there? We don't go out of our way to make CPUs more complex, either chemically or in terms of circuits, their complexity is just what results from what we want them to do. What we want them to do isn't (yet) "reproduce" or "eat", unless you count the entire larger industrial ecosystem of which they are vital element as well as being a byproduct, as even this paper is in the hypothetical.

Looking at the abstract and skimming the rest, it is suggesting something involving a much bigger system than a silicon chip, but it's still more akin to how a virus hijacks the molecular processes of the actual factory (i.e. the cell it infects), or primates using bones as tools if you prefer a macro-scale analogy.