Why did Prithivi Narayan Shah named this country Nepal? Wouldn't it make more sense naming the country 'Gorkha' since it was his kingdom before the ununification?

Not that the Gorkhalis didn't try their best for their newly unified/annexed territories to be called Gorkha.

After the unification, Gorkha and Gorkhali was officially imposed on Nepal (then understood as Kathmandu Valley) and the Nepalis (then understood as Newars). You have institutions as remnants of that - the Gorkha bhasa prakashan parishad, Gorkhapatra, Gorkha Bharat Jiwan (first newspaper in Gorkhali language), etc. "Shreeman Gambhira Gorkhali" was changed to "Shreeman Gambhira Nepali" only in 1960s.

The British, for some reason, always stuck with the name Nepal in their accounts. Newars too stuck with saying Nepal and Nepalbhasa for their land and language, and making the distinction with Gorkha and Gorkhali/Khas bhasha.

The Gorkhalis did definitely try to change the name. But it just did not stick.

/r/Nepal Thread