They are, but your average person thinks of the two entirely separate.

Many people feel a refurbished device is inherently messed up and they don't want to accept a refurbished unit as a replacement for their USED and DAMAGED device. They want the one thing repaired in store and their same device back. No matter what. Even when that's simply not reasonable for practical.

I've done phone, tablet, and computer repair for over 15 years now, both OEM certified (including Apple) and entirely third party. For some people the distinction between getting their same watch back with a new screen and a refurbished replacement is massive. Even though that refurb replacement likely was a small repair as well, just something not really field repairable.

For companies like Apple, some repairs they don't do in the field only because of the time it would take. Or the part they send for those in a retail location is a full assembly instead of just what needs to be fixed.

Button not working on your phone? For many companies, they aren't going to strip that phone down and replace the button ribbon, even though that is a separate part. Those ribbon connections are often routed under the battery and around the frame. It would take an hour to disassemble and make that repair. Not feasible for a retail repair environment. If they repair it at all, they would instead just replace the entire housing with many of those small components already installed, which is a much more expensive part, but faster. In most cases though the manufacturers would instead just replace the device for time consuming repairs like that, and the device would then be refurbished at a warehouse where they can take the time for an in depth repair like that.