Probably because to adapt the book would mean quite a high production value - and some rather large special effects. They'd need to sculpt two dummies - Mr. Wood and Slappy, make one vomit green goo onto an audience of children, then run one of the dummies over with a steamroller.
It is rumoured that they did make an adaption for NotLD, but it was deemed too frightening for children and never aired. This would explain why Slappy in the TV series looks more like the design of Mr. Wood - they wouldn't have bothered to make a new dummy and waste the old one, they'd just reuse Mr. Wood. But nothing has been confirmed. Hope you enjoyed my Ted talk.