It makes for very handy use cases where other applications can work on the same data. This could be easily adding content into your notes (without needing an API to do so), using external editors for working on certain aspects of your notes, or even just the super handy convenience of having everything in one directory structure.
My Obsidian notes are right inside the same folders as the PDFs and other resources they refer to. I don’t have to have a tree structure inside my notes and then the same tree structure in my hard drive or Dropbox or wherever with all my other files.
I was a 10+ year Evernote veteran, and I couldn’t go back to the single DB style like Evernote or Trillium. I wish there was an open source competitor to Obsidian, but alas not yet.
And as @acockworkorange rightly points out, people (me!) have been burned in the past by a program becoming obsolete and having your files stuck in some proprietary format. Plain files right in a folder on the disk is the way to go.