>if you mistyped your password, it would print the mistyped password,

That's incredibly useful. Stand next to someone, casually chatting, while they enter their password. Just before they hit [ENTER], stab a key -- say, a 'z'. Boom, it prints their password with an extra 'z' at the end.

Sure, they'd be aware of it and likely change their password. But still. A more common use case would be to hang around and wait for them to inevitably typo the password. If you see that enough, you'll get a really good idea about what it's supposed to be, or at least give you enough of the password to make figuring out the missing part trivial.