While I am certain Senator Warren would make a great treasury secretary. Remember the Massachusetts governor is a republican and if she was appointed a republican would get her senate seat. The senate is in play and the democrats need every seat to have a chance. Because if the dems hold house and senate the would effectively block trump if he is re-elected.
To put it simply, the Ds dominate the state legislature and will do whatever it takes to maintain power for their party. To expect them to do otherwise would be like asking the R administration to voluntarily hand a SCOTUS seat over to the Ds.Power rarely, if ever, is voluntarily ceeded.