This exists in some games (Dungeon Siege i think). Usually I'd find this a bad idea. But there are a few reasons why this would be a welcome addition in D3. First of all, your drops are personal, so you can't just grab everything from other players. And secondly, there are actually reasons for picking up everything (sell/salvage).
The disadvantage would be that you can just go around pressing that button, and then salvage everything in your inventory. That kinda takes away from selecting which items would be worth selling/salvaging. Also, imaging after a boss drop, you'd just always press that button without even looking what dropped, so the items might as well have appeared right in your inventory. It kinda takes away from looking what dropped, pickung up the uniques first, then checking the other stuff to see if there's something valuable.
So well I could understand them not introducing such a function, but I'd use it if it existed. They won't introduce it though: there are scrolls of companion, which create a little creature picking up gold for you. Also, if I'm not mistaken, there's a stat that increases your gold pickup range. If you could jsut pick up everything in a certain radius around you, both would be rendered obsolete.
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