To your point that dual citizenship is not legal in the U.S., however, the U.S. policy on dual citizenship stipulated in the State Department's Foreign Affairs manual indicates that dual citizenship is recognized (e.g. not illegal) but not encouraged.
7 FAM 081 SUMMARY(CT:CON-106; 06-06-2005)
e. U.S. Policy on Dual Nationality: While recognizing the existence of dual nationality, the U.S. Government does not encourage it as a matter of policy because of the problems it may cause. Dual nationality may hamper efforts by the U.S. Government to provide diplomatic and consular protection to individuals overseas. When a U.S. citizen is in the other country of their dual nationality, that country has a predominant claim on the person. A foreign country might claim you as a citizen of that country if (a) you were born there; (b) your parent or parents (and sometimes grandparents) are or were citizens of that country or (c) you are a naturalized U.S. citizen but are still considered a citizen under that country's laws. (The oath you take when you are naturalized as a U.S. citizen (8 CFR 337.1) doesn’t mean the foreign country does not still regard you as a citizen of that country.) Public inquiries about the citizenship laws of other countries should be directed to the embassy or consulate of that country in the United States. 8 U.S.C. 1185(b) (Section 215(b) INA) and 22 CFR 53.1 require that U.S. citizens exit and enter the United States on a U.S. passport, with certain limited exceptions (22 CFR 53.2).
My point being that if there is no law on the books expressly permitting it under our US naturalization laws, it is not “legal” in the sense of being covered by specific US law.
It is “recognized” in the sense that it is “tolerated”. Why has it never been officially adopted as an “official citizenship” status? Lots of new laws dealing with lots of other countries would ensue. Talk about a nightmare!
This way the US can just look the other way if you are in the “other” country you have allegiance to and that country lays claim to you.
The old: “ Dual nationality may hamper efforts by the U.S. Government to provide diplomatic and consular protection to individuals overseas”, problem shows up and the US may just wash it’s hands of you. If dual citizenship were officially law, the US would/could be obligated to go to bat for you no matter the situation, costs, time and effort involved.