I can only speak, and 2nd hand, to the Chip[ timing issue (and BTW, Lilac Bloomsday, a lot bigger race, doesn't use the Chip either).
The reason I've heard is that Bix has a huge contingent of volunteers working the finish line and chutes (24 chutes) who love to be a part of the biggest thing in the Quad Cities, and really take pride in their efforts. Bring in the Chip and these folks are reduced to checking runners exiting the pens at the finish.
There's an added cost for Chip timing due to rental of the actual Chips, so the race would have to come up with additional sponsor $ to cover it. Now suppose that sponsor pulls out after a couple years. You can't go back to the old method b/c those dedicated volunteers are gone, so you have to pass the cost on to the runners.
I've never run Bix but I've worked at it the past 5 years and I think it's one of the better races on the circuit, and I've been to a lot of them. It is really a community event, which is hard to accomplish with a race that big.