Simple. It's bc the conditions that are needed for bones/tissue to be fossilized are incredibly rare, which is why despite dinosaurs having dominated the planet for hundreds of millions of years, their fossils aren't able to be found literally everywhere.
As for how this works, fossilization occurs when the dino remains are rapidly buried by sediment, which protects them from decomposition and scavengers. Overtime, the sediment begins hardening into rock, as minerals seep into the remains and replace the organic material.
Besides, dinosaurs existing much more recently in history than what we're told is a pretty weird lie for the government to tell, not sure what incentive they would have there.