I can certainly envision several reasons why your LBS told you that.

It could be that the shop employee was inexperienced and doesn't know much 
about older bikes. 

Or it could be that the shop doesn't want the liability associated with 
installing parts that are, technically speaking, incompatible with the frame. 

Or maybe, they've gone down the rabbit hole of modernizing old bikes in the 
past, and feel that it isn't worth the trouble. I know that I've had experience 
with that kind of thing, where some unforeseen and seemingly trivial 
incompatibility issue causes the project to take 5x longer than quoted and in 
the end, the solution was a kludge that isn't 100% satisfactory.

Or maybe you're the fifth guy this week who wanted to put a modern parts group 
on an old bike, and they figured that, like the previous four, you'd balk at 
the high price, and it would be just easier for everybody if they cut to the 
chase and say "no". After all, buying a parts group and wheelset and the labor 
to install it all can often cost as much as or more than a new bike that has 
the same parts and wheelset. 

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