You wouldn't want your "interactive" user filesystem on S3, no, but as the storage backend for a server application it makes sense. In those cases you very often are just storing everything in a single flat folder with all the associated metadata in your application's DB instead
By reducing the API surface (to essentially just GET, PUT, DELETE), it increases the flexibility of the backend. It's almost trivial to do a union mount with object storage, where half the files go to one server and half go to another (based on a hash of the name). This can and is done with POSIX filesystems too, but it requires more work to fully satisfy the semantics. One of the biggest complications is having to support file modification and mmap. With S3 you can instead only modify a file by fully replacing it with PUT. Which again might be unacceptable for a desktop OS filesystem, but many server applications already satisfy this constraint by default
By reducing the API surface (to essentially just GET, PUT, DELETE), it increases the flexibility of the backend. It's almost trivial to do a union mount with object storage, where half the files go to one server and half go to another (based on a hash of the name). This can and is done with POSIX filesystems too, but it requires more work to fully satisfy the semantics. One of the biggest complications is having to support file modification and mmap. With S3 you can instead only modify a file by fully replacing it with PUT. Which again might be unacceptable for a desktop OS filesystem, but many server applications already satisfy this constraint by default