That's actually a really good question - I'm not actually sure why they switched, but the cynic in me thinks it has a lot to do with the perception of efficiency and the whole governtment-wide push towards technology-driven work. In the past, you either had an in-person interview, or, if you weren't able to do so, you could have a phone interview. All of which was done with a recruiter.
Now, as you may have already noticed, the recruiter actually has NOTHING to do with the process of becoming a PCV. Their only role is literally recruiting - getting people to put in applications, and helping people to try to put in good applications. They can answer general questions, but no longer have a role in selecting or placing applicants. Everything now is done by the placement officers. This changed with the 'new' process, so maybe it does actually make more sense to have the placement officers interview for specific countries since they are the experts on what that country's needs are, and now you apply to specific openings in specific countries (unlike the 'old' process where you just applied to PC and got what you got).
There are no placement officers anywhere other than DC, so from a practical perspective, this makes it impossible to interview candidates one-on-one as people apply world-wide. What annoyed (?) me, though, was that I literally worked 2 blocks or so from the office in DC and STILL couldn't interview in person. I've done four interviews with PC over a decade, and three of them were in-person.
In my opinion, much better - not only from the interviewer's standpoint as you mention, but also from my perspective as the interviewee!