Because, seriously (and it's even brought up in the newest issue of the Ba Sing Se Times), the Dai Li really didn't need to be there, at least not like that. Seventy years after they'd betrayed the Earth Kingdom, somehow they're now trainers for the Earth Queen's new Airbender army, they don't use hypnotism, and they can't control the rioting in the palace upon the death of the Earth Queen. Have they gone completely wolfbatty, or is this just another devouring of plot by the franchise moths? Have at it, folks!
I like to think of LOK Dai Li as a watered-down, startup version of the ATLA Dai Li. So the original basically committed treason by leaving/helping with Azula. So maybe 1-2 found their way back in the Dai Li undercover? But probably not. The new Earth Queen Hou-Ting probably had heard about them, maybe even had seen them when she was younger, and wanted a force like that for herself. So using the original scrolls from when Kyoshi set them up, plus some orders from the queen, a new underpowered, less trained version of the Dai Li was formed, but under different pretext, only to serve the queen and whatever she needed, rather than as a solid police force and protection.
Very, very very watered down. If ATLA Dai Li were in charge, they could protect the palace at least with huge success. They'd pin down stronger rioters and shot down earthbenders, while creating massive barricades, trenches and stuff around the palace. They'd tunnel down under most clustered areas and trap them all, hurls massive rocks and statues, create obstacles that would make advance on palace grounds a living, brutal hell... it would go from your average riot mob vs police fight to the freaking Omaha beach landing in few minutes.
A decently trained, equipped and prepared team of about 10-20 Dai Li agents could take down the ruler of any nation, should they want, except those who are freaking badass earthbenders, or in LOK terms, metalbenders (but I think they would be trained in metalbending, should it become so prevalent in that age).
Actually, Azula was really lucky that those Dai Li agents didn't decided to simply put her down and assume control during her breakdown. (plus pinning down Katara and avoiding Zuko's coronation? now that's my style)