For the same reason that in the Middle Ages, men built huge cathedrals; the beauty and greatness of the structure was meant to be both an expression of honor for the being they worshipped and an earthly demonstration of what they were capable of creating. Khazad-Dum was a special place for Dwarves, sort of their equivalent of Mecca, and it's understandable that they'd spare nothing to make the most beautiful and impressive structures they were capable of.
If you go to York Minster, or any Russian cathedral, you'll get dizzy if you look too long up at the ceiling, and in the middle ages most people were rather closer to dwarf-height than we are. The Dwarves couldn't use all that space any more than we could use all the space near the ceilings of York Minster, but it didn't matter. The point was that the building was beautiful and grandiose and unforgettable. And for lighting the chandeliers - I'm sure the Dwarves had enough in the way of technology to graspt the concept of ladders [img]smilies/smile.gif[/img].
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Father, dear Father, if you see fit, We'll send my love to college for one year yet
Tie blue ribbons all about his head, To let the ladies know that he's married.
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