As you can see in conf/machine/tune-strongarm.conf, we already tune everything for xscale (-mtune=xscale), but we don't allow the gcc to use the few arm5 specific constructs, which would have a bad impact on arm4 performance.
Our gcc experts have found that using march=armv5te wouldn't give much of a benefit - especially not compared to the need of having to build more feeds. So unless someone comes up with some packages / benchmarks which proof something different, it'll stay that way.