- If you subscribe to the fan theory that James Bond is a code name and several agents have used it (explaining Bond's long career and changes in appearance caused by multiple actors), then it's possible that the grief over Tracy's death caused Lazenby-Bond to resign from MI6, or he was declared psychologically unfit to continue. This resulted in Connery-Bond returning to duty for Diamonds Are Forever before being replaced by Moore-Bond.
- Or, if you subscribe to another fan theory that Bond and Blofeld are both Time Lords
, the stress could have triggered a regeneration. - That or he committed suicide. After all, the movie begins with James stopping Tracy from committing suicide by drowning due to, among other things, the death of her spouse. Now Tracy is dead and there's a beach right by their car, and he does say "We'll be going on soon...."
- Alternatively, he could have turned into Jack Wilton...
- Blofeld is seen preparing multiple body doubles in Diamonds Are Forever - training loyal henchmen to act and speak just like him. By the time of that film, he perfected the ability to replicate his voice and appearance, but perhaps it wasn't as perfect in its earlier stages. At the time of You Only Live Twice the Piz Gloria operation was an active SPECTRE operation headed by an American henchman paid to impersonate Blofeld and distract from the real Blofeld's space-based agendas. This explains why Savalas-Blofeld is so physically active compared to his counterparts - it's his job. It also explains the accent, the lack of a facial scar and why he doesn't seem to recognize Bond or bring up their previous encounters: he was putting this operation together when Bond was in Japan and never met him. It also explains why Gray-Blofeld never mentions Tracy - they never met.
At their previous meeting, Blofeld's right eye was surrounded by scarring
◊ that, at best, would slightly impede his vision; at worst, the eye itself may have been damaged and effectively blind. If Blofeld is even somewhat nearsighted in the other eye, this could work out to very poor vision overall.
At the meeting in Switzerland, Blofeld has obviously had extensive plastic surgery. Since his performance in the action scenes implies adequate binocular vision, his eye has probably been treated surgically as well. But no matter how well Blofeld can see Bond now, he can't recognize him if he never got a good look at him in the first place.
This also makes it all the more logical for Bond to disguise his voice, since that is the one characteristic Blofeld could easily recognize.
