There is no reason for a steel yacht to be less beautiful than an aluminium yacht and there are plenty of beautiful relatively small aluminium yachts. It can be done, but it is not done, I mean the designers specialized in aluminum and steel boats are for many years doing almost exclusively aluminum boats. I don't say that they will not consider steel a good option it is just that there is not a significant market for them.
The Dutch (Hoek is Dutch) are one of the European countries where metal (steel and aluminium) boats are truly appreciated and they always had NA specialized in steel and aluminium boats.
Let's take for example Dick Zall, he says about steel boats:
"Steel has many advantages for boat building, among the foremost of which are its strength and resistance to abrasion and impact. “A small boat built of steel is as close to truly indestructible as it’s possible to get,” writes naval architect Dave Gerr in The Nature of Boats. Another advantage of steel is that it’s easily worked on by welders anywhere in the world, making repairs inexpensive for cruising boats.
It is also ductile, or stretchable, which means that if you hit a rock or a half-submerged shipping container, you’re not likely to sink. The hull may be dented and deformed, but it probably won’t be holed, as a wooden or fibreglass hull might be. On the other hand, steel vessels are heavy because to keep the skin plating from wrapping during welding, a plate thickness of 3 mm is minimum, and often 4 mm is used for this reason.
So it takes boats longer than 15.00 metres to become more or less equal with some other building materials, although it remains a lot heavier than composite for instance.
However the performances of a proper designed heavy displacement yacht are just what is ideal for the long distance cruiser, taking a lot of stores and gear along.
She will more easily float on her designed lines, while a light displacement yacht taking the same load will become dangerous as well as misbehaving."
He says something I have heard other NA saying: It does not make sense to make a very small (less than 40ft) steel boat. The sail performance would be bad, while a bigger boat (45/50ft) would have comparatively a much better performance. This is because the weight of a steel boat is not proportional to its size and it is possible to make a bigger boat proportionally lighter.
Regarding what I was saying about the almost non existence of new designs in steel even in the designers that used to work with the material, just look at the page of Dick Zall regarding the boats he had done in steel and the ones he is doing in aluminium. It is easy to see that steel designs are all old designs while we can find several contemporary designs regarding aluminium boats:
Designs Overview : steel | Dick Zaal Yacht Design
Designs Overview : aluminium | Dick Zaal Yacht Design
If we do the same with other famous Dutch Na specialized in steel and Aluminium (Koopmans, father and son) we will see the same. New designs are in Aluminium.
For what I understand many aluminium designs could be built in steel with some structural alterations and vice-versa. Koopmans offers many of his designs in steel or aluminium. The reason steel is not utilized has not to do with any difficulty in doing nice boats and nice designs but due to the market, meaning sailors want faster boats even if at the cost of less resistance to impact and a bigger price (regarding aluminium).
Fact is that the standard of sailing boat speed have been increasing rapidly. Today a main mass market boat like the Jeanneau 409 is faster than a 30 year old cruiser racer, new materials and the use of infusion cored boats made fiberglass boats much lighter increasing a lot the difference of weigh between a steel boat and a fiberglass boat and to that difference corresponds an increase in the difference in performance.
Steel boats made no sense today? Off course not, they are still the strongest boats but only few (except for some extreme sailing) would chose them over other material options. That is not an opinion, it is a fact that as a direct reflex on the market.