but why on earth would virtually anyone want that in a laptop, let alone as the default setting?
Prior to Tiger Lake (IIRC), Intel implemented NVMe RAID and SSD caching (Optane Memory) using a weird feature of the PCH to hide NVMe drives from the regular PCIe system and make them only accessible through the SATA controller, so that only Intel's RST drivers would be able to find the NVMe drives. OEMs were encouraged to have this functionality enabled by default, and it was sure to be on by default for any model where Optane Memory was one of the available storage options.
When Intel started providing PCIe lanes for NVMe drives direct from the CPU rather than through the PCH, they needed a different method to ensure that regular NVMe driver software couldn't find and claim the drives before Intel RST did. That's why they brought VMD to the consumer CPUs (no, there weren't any plans to start offering hot-swappable NVMe drives in laptops). It had the nice side effect of meaning that Intel's storage hacks for the sake of RST no longer caused problems for Linux users, because VMD was already well-documented and fully supported by Linux, quite the opposite to Intel's prior PCH-based strategy.
Now that Optane Memory is dead, Intel sold their SSD business, and DirectStorage is forcing everyone to stick with the regular Microsoft NVMe drivers, these shenanigans should be gone for good.