Why do dinosaurs have small hands?

The evolution of a large powerful neck, jaws, and hind legs was determined to be a favorable adaptation. Smaller, yet powerful, forearms were part of that adaptation. When attacking another animal, T-Rex pivoted at the hip, like a lever at it's fulcrum. The massive and heavy head was counter-balanced below the hips by the legs and tail. Because the head and jaw muscles were so large, there was selective pressure to reduce the size of the arms in order to minimize the animal's weight above the hip.