Why “daily” and not “dayly”?
From the quoted definitions at etymonline, I would suspect that you may be asking the wrong question :)
If I look at the related words in other languages (dag, Tag) for day, it seems the final g has changed into a [j]. The same seems to have happened with (Dutch) leggen -> English lay.
As it is normally pronunciation that defines spelling, and not the other way around, it seems that the i did the job of representing that [j] in daily quite well. However, as a final vowel, the i seems to be uncommon in English, and usually written as a y. (Compare Dutch hooi to English hay).
So where dæglic became daily (the final [k] became [i]), dæg became day. In both cases the g got to be pronounced as [j], but instead of dai, hai or gai, the use of y was preferred to write that sound in a final position.
Since I was getting a bit caught up in trying to write out some fairly complex things in comments to @medica’s answer, I am going to write it all out in a full answer here.
Basically, there is a more or less regular variation in some words between final -y and non-final -i- (sometimes -ie) in English orthography. That means that when adding various suffixes to words that end in -y, you have to know whether to change it to an -i- or not, based on a certain set of rules (plus some exceptions—this is English after all). The rules for when to choose what are as follows:
Phonetic quality of -y
The first thing to determine is how the -y is pronounced. There are three possibilities here:
- /i/, as in ‘ready’, ‘silly’, etc.
- /ai/, as in ‘sly’, ‘shy’, ‘apply’, etc.
- /j/, as in ‘day’, ‘whey’, ‘coy’, ‘buoy’, etc.
Regardless of what suffix you’re adding, these different pronunciations affect when the spelling does and does not change.
Phonetic makeup of suffixes
In addition, the pronunciation of the suffix that you add to the end of the word also makes a difference, or rather, the start of the suffix does. Here there are four possible variations:
- Suffix consists only of one consonant (noun-plural -(e)s, verbal third singular present -(e)s, past -(e)d, strong verb passive participle -(e)n)
- Suffix starts with a consonant (-ness, -ful, -less, -some, etc.)
- Suffix starts with the vowel /i/ (-ing, -ish, -ive, -ify, etc.)
- Suffix starts with any other vowel (-er, -est, -en, -able, etc.)
Combining -y and suffix
When you combine a final -y with a suffix, you have to look at each combination of the seven options mentioned above separately (though some of them can be lumped together, of course).
In the following, I will simply write the -y as its phonetic realisation (/i/, /ai/, or /j/), and as a shorthand, I’ll write the suffixes as simply X (only one consonant), C (consonant-initial), I (starts with /i/), and V (starts with any other vowel). If a rule goes for all types of -y or suffixes, I write ANY. (If two types go together, I just write them together; so CV means ‘suffix that starts with a consonant or a vowel that isn’t /i/’, for instance, and /i ai/ means -y pronounced either as /i/ or as /ai/.)
Exceptions to the main rules are in bold.
(‘Daily’ is in the very last section.)
ANY+I⟹ -y-Before a suffix that starts in /i/, -y never changes—it always remains -y-, no matter how it’s pronounced. (Even words that end in -ie change this to -y- here, such as die ⟹ dying, or lie ⟹ lying.)
- busy ⟹ busying
say ⟹ saying
shy ⟹ shying
clay ⟹ clayish
dry ⟹ dryish
/i ai/ +
X⟹ -ie-Before a suffix consisting of only one consonant, -y pronounced /i/ or /ai/ is written -ie-
- busy ⟹ busied, busies
dry ⟹ dries, dried
/i/ +
CV⟹ -i-Before a suffix starting in a consonant or a non-/i/ vowel, -y pronounced /i/ changes to -i-. (This does not happen in the rare instance where the -y pronounced /i/ follows a vowel sound; so gooey ⟹ gooeyness, rather than *gooiness or *gooeiness.)
- busy ⟹ business, busier, busily
study ⟹ studier, ?studiable
very ⟹ verily
/ai/ +
CV⟹ -y- (sometimes also -i-)Before a suffix starting in a consonant or non-/i/ vowel, -y pronounced /ai/ generally remains in monosyllabics, though there are some individual exceptions where a variant spelling with -i- also exists. In polysyllabic words, -i- is the rule.
- shy ⟹ shyly (shily), shyer (shier), shyest (shiest), shyness (shiness) (forms with -i- all rare)
cry ⟹ cryer/crier, ?cryable
dry ⟹ dryly/drily, dryable/driable, dryness
apply ⟹ appliance, (?)applier
rely ⟹ reliant, reliance
/j/ +
X⟹ -y- (sometimes -i-)Before a suffix consisting of only one consonant, -y pronounced /j/ generally remains. After such a y, the past and past participle suffix is -ed (with the e), but the present suffix is -s with no e. In the past and past participle forms of some irregular verbs, the y changes to -i-, and the suffix, whether -(e)d or -(e)n, never has an e.
- day ⟹ days
play ⟹ plays, played
slay ⟹ (?)slayed, slain
lay ⟹ lays, laid, lain
toy ⟹ toys, toyed
/j/ +
V⟹ -y-Before a suffix starting in a vowel, -y pronounced /j/ usually remains. Only one exception that I can think of, highlighted below.
- grey ⟹ greyer, greyest, ?greyable
coy ⟹ coyer, coyest
buy ⟹ buyer, buyable
gay ⟹ gayer, gayety/gaiety
/j/ +
C⟹ -y- or -i-Before a suffix starting in a consonant, the basic rule seems to be that -y remains; but there are some exceptions where it changes to -i-, one of which is the word asked about in the question: daily. Sadly, these exceptions seem completely random and must be learnt by heart.
- coy ⟹ coyly, coyness
grey ⟹ (?)greyly, greyness
gay ⟹ gaily, gayness
day ⟹ daily, ?dayful
array [in the sense ‘beautiful clothes’] ⟹ raiment (from earlier (ar)rayment)
I believe this comes from established patterns in spelling. If a word ends in a consonant, you could add -ly. (Nightly, hourly, promptly, quickly, etc.)
If a word ends a consonant + y, one changes the y to i and adds the ending (-ly, -ness, etc.)
Ready -> readi +ly/ness. Greedy -> greedi +ly/ness. Happy -> happi + ly/ness.
When y is preceded by a vowel (or h), it keeps the y. Coy -> coyly/coyness, shy -> shyly/shyness.
There are exceptions, (day -> dai + ly) but this should be a good guide (I hope).