Mary and Elizabeth were restored to the succession by Henry.  There titles were not.  When Mary became queen, she was still considered a bastard.  Parliament would have to declare her legit. Mary's first Parliament overturned her parents' divorce.  She was legitimate again.

Elizabeth looked into the matter when she became queen, but did not act to change anything.   

I would imagine that Henry thought there was no real reason to restore the Princess title to his bastard daughters. In his mind, Edward would live for a very long time and produce a gazillion males heirs so Mary and Elizabeth would have no chance of ever hopping onto the throne. Therefore there was no need for them to be titled Princesses to prepare them in becoming a Queen. Henry probably only restored them to the succession in the extremely unlikely event that he needed a back up plan and he would prefer someone with his DNA got the throne as opposed to a cousin.

He had no issue ignoring his eldest sister in the line of succession and removing her family from the throne, when in theory she should have had first bite of the succession apple. That's why I find it amusing, that Henry went through all this effort to keep his throne English (out of spite) but in the end it failed because the only functioning part of his family tree in the end was his eldest sister's line.