How exactly were the (Ashkenazi) Rabbis allowed to cease the Birkas Kohanim seeing as it is a mitzvah D’yoraisa?
The Rm"a (OC 128:44) writes that the Kohen must be happy when saying the Bracha. In Chutz La'aretz Jews are not happy except on Yom Tov, therefore they do not say the Birkat Kohanim even though it is a Mitzva D’yoraita. This is based on the Pasuk in Mishlei: Happy at heart he will bless. Rabbi Yitzchak Grinblat