What I've finally come to understand is that there is a large amount of people who are now able to write and use software through claude and coding agents. Those people have different needs than more traditional software engineers who have more knowledge because even best llms often need steering, correction, and refactoring suggestions when iterating on code and it's fine to let it lose context because exactly like you said, you tell it to read file and then have to regurgitate the understanding so you can correct or validate it before continuing.

For those where the code is almost entirely a black box and cannot easily recover when something goes wrong. They are much more keen on this context management and planning because recovering from derailments is much harder (and takes longer) because its often a conversation with llm to try to recover to where they were before.