You are absolutely correct that it could never work in Elite Dangerous as currently designed.
Id strongly dispute that it isnt feasible, though, as ive played lots of open world games that managed to keep everyone who was in one area in the same instance.
Ill be honest, i have no idea if it would work cross platform, but id also say that its would be HUGELY preferable to have just separated the platforms if thats a technical barrier to having people in the same instance.
As it is, this is a single player game where its possible to select a mode where you can chat to other people playing the same single player game, and thats all it will ever be.
What games are these? Because I am suspecting they aren't tracking the same level of real time data as Elite Dangerous does.
Remember if you are talking about "everyone" that's possibly tens of thousands of players, in one instance at the same time.