This feature allows external software to get to the underlying representation of a page without having to do complex things with HTML. Also, with TransClusions directly into WikiSyntax, it allows foreign wikis (with the same syntax) to embed content from this wiki. This feature, although seemingly arcane, is very useful if you keep an OnlineDiary here despite having a wiki elsewhere.
Why not send the raw text to the client all the time, who can choose to view & edit in raw form, or render it to HTML? Because most users have an HTML rendering browser. AlexSchroeder started to write a wiki browser for Emacs (see EmacsWiki:SimpleWikiMode), which uses raw mode all the time. Some people still use and improve it.
HTTP Content-Negotiation (or some WWTP mechanisms) should be used to decide whether RawMode or HTML is used.