Why Hood remained a battlecruiser

Between Hood and Iowa, which was closer to being a battlecruiser?

Hood by a wide margin; Iowa was a fast battleship, while Hood's design and intended combat role remained those of a battlecruiser.

Hood's classification as a battlecruiser rests on her subdivision, armor coverage, and intended opponents. The design began as an enlarged Renown-type concept and changed during construction after Jutland, but those changes are judged insufficient to turn it into a fast battleship. Iowa is treated as a fast battleship. Classifying either ship is complicated by the absence of a contemporary battleship serving as a direct reference: Britain built no matching generation alongside Hood, and the United States did not build Montana. The G3 and N3 projects illustrate the value of comparing contemporary designs with different missions. In this interpretation, Hood was intended to fight battlecruisers and use speed to avoid a battleship such as Queen Elizabeth.