The exact same thing can be argued of ISPs.
If ISPs created a simple caching program that acted like a proxy for BitTorrent chunks then they could offload much of the traffic from their interconnects with other ISPs onto their own networks, saving them untold amounts of money.
Note also that downloading from your neighbor in most cases in North America will yield only a small upload speed as most residential lines have pitifully small caps on upload speeds. I highly doubt you will see 500Kbps from your neighbor unless hes paying for a t1 line, in which case location is irrelevant.
BitTorrent doesn't care about ISP costs because they aren't impacted by them, nor IMO should they care without some kind of incentive. If the ISPs are going out of their way to get in my way about torrenting then I don't think that BitTorrent should go out of its way to save ISPs some cash that we all know isn't going to go back into the network but into somebodies pocket. If there was a tangeble benefit on the other hand, like if the speeds really ^did^ improve from downloading from local hosts, or if the savings was passed onto the consumer by not counting toward their bandwidth limit, then I could understand the reason, but this is not the case.
Besides all of that, seems to me like its better for the economy to have ISPs spending oodles of money on each other because I'm downloading from outside of their network, spending money keeps the economy going.