Sure except that this was a ground up redesign of Taco with brand new platform. This was not retro-fitting onto old platform.I can understand your view point and why you say this but I'd offer a different view:
Toyota took a pretty simple/conventional 4x4 drive train, with open differentials, designed for a light duty small pickup aimed at a lower price point market and built the Tacoma. They then added computer aided traction control. Traction control (MTS) allows the mechanical, open diff drive train (yes the off road version has a rear locker) to do things it otherwise couldn't do. MTS does greatly improve the off road performance of truck (especially for 99% of the 10% that actually takes these things off road).
So what happened here? Wy did the diff break? The simple answer is that something in it wasn't strong enough. The next question is why wasn't is strong enough? The answer is, there is a possible use condition that results in overstressing some component in the diff. What caused this condition to exist? The answer is that the MTS logic allowed all the torque to go to one wheel and when that wheel lost traction, the ABS clamped down on it and something broke.
So what's an engineer to do? If the truck didn't have MTS, it likely wouldn't have broke, but it also would likely have not have made it up the hill and would generally perform worse in all off road situations. I would be willing to bet that there were many engineers at Toyota that initially said "lets make the thing that broke stronger". But would doing that result in any actual performance improvement? Would the truck have made it up the hill if it hadn't broke? There's no definitive answer to that. Different line, different driver, lots of factors, who knows. Obviously not blowing up the diff in this situation is more important than making it up the hill, but trying to bullet proof the diff will just lead to finding the next weak link, has risk of its own unintended consequence, would cost a ton, and take a long time time to redesign and build.
IMO, it was the MTS software that killed the diff by allowing a situation to exist that the diff wasn't designed to handle. It allowed too much wheel speed and the ABS to act too quickly and abruptly. The engineers original goal was to tune the system in a way to improve traction performance and not break things. They missed this situation. Had they not missed it, they would have almost certainly tuned the software to protect the diff rather than redesigning the diff. I doubt that whatever software tweaks they made to the MTS system have any significant negative impact to off road performance (I admit this is total assumption). Personally, I'd rather have a software update, even if I lost a little uphill snow wheeling traction control, than a newly designed diff.
So did they use software to to fix under engineering or did they use software to maximize off road performance of an existing mechanical system within its mechanical limits? Both are true, its just perspective. Generally though, an engineer's job is to optimize performance, reliability, cost and schedule in a way that allows the business to make money, and continue to exist. Building the bullet proof brick sh*t house doesn't usually cut it.
And IMO, you design software around the hardware. Not the other way around.