That's a good question. Of course, in the A&U1st and 2nd printings, the illustration was a half-tone plate; I guess it didn't appear in the 3rd and 4th impressions for the same reason as the other plates - that is, wartime restrictions. But as for why not in the second, and later editions - I can't guess.

that's from 1st edition Houghton Mifflin edition, I think

Yes, it's the version redrawn (almost certainly not by Tolkien) for the American edition and printed as line art rather than as a half-tone.

I often wondered why it was not in the later copies, did Tolkien not like it or think it was out of place in the book?

Tolkien liked it just fine, though he wanted it to be the front endpaper in The Hobbit, with Thror's Map an inserted plate (with the moon-runes on the back), not the other way around. As Garm says, its disappearance after the second printing (1937) of the Allen & Unwin edition, along with all but one of the colour plates, was probably a matter of economy, and austerity continued until well after the war. I'm not aware of any correspondence about Mirkwood when the colour art returned to the book; perhaps new printing plates were needed, and because the original art for Mirkwood was unavailable (Tolkien had given the drawing to a student from China), it was left out. But this is just guessing.

Wayne

Edit Trotter Wayne is replying to an incorrect comment by me which was incorrect and I deleted.

Was it included in the 2nd GA&U impression?

Yes. I have a copy in front of me.

Wayne

I think it is appropriate to mention the facsimile edition by HarperCollins coming out next year.

I'd love it to be the first impression, but now that I know (thanks Wayne & Christina) that the second impression also has Mirkwood and colour plates, I'd reluctantly settle for the 2nd (but first please).

The mirkwood picture isn't there now...