It's not just Ancestry that has outdated geographical locations, familysearch doescas well. If you use their catalog to locate digital images, sometimes you need to know older names for places, or alternative spellings.
The local government reorganisation in 1974 did not move places to different counties, it just placed them in different organisational units.
There have never been counties with the names "Avon", "Humberside", "Greater Manchester", "Cumbria" etc.; the places governed by those councils are STILL in their traditional counties. Note that many of those 1974 names have already disappeared, to be replaced by a plethora of more trendy "unitary authorities".
So it makes sense to use the traditional county names throughout. That way it's obvious when people stayed put and when they moved.
There is an oddity. London became a county in its own right in 1889. Because most of my research predates its invention, I use the earlier counties, such as Middlesex.
There are places which changed their name. Wootten Bassett, for instance, would now be filed under R for Royal, but relevant records are likely to be found under W. Another which comes to mind is Church Hulme, which became Holmes Chapel in 1974.
There are also latinised names which confuse the Usual Suspect websites. "Hulton Superior", where many of my ancestors lived, is now labelled "Over Hulton", and would have been consistently referred to as such in speech, even by the chap writing the latin version in the parish registers.