I also don’t understand why this is a limitation but as a workaround you can use the API to create the duplicate. It works even if RLS is applied to the original dataset.
But now it requires an engineer to do this duplication, whereas an analyst should be able to do this on their own to test changes and make development-grade datasets before they get integrated by engineering.
Yes, you can use DescribeDataset on the original dataset and copy the dataset definition which includes the RLS configuration. Then, use CreateDataset and paste the dataset definition from the original to create the duplicate.