* If you expect your code to be used as a dependency to a proprietary system, don't use the AGPL.
* If you are building a stand-alone system, or tools for an open ecosystem, use the AGPL.
That's a question of suitability-to-purpose. Although this use is permitted, AGPL simply isn't a good license for PostGIS (which is correctly licensed under the GPL). It is a great license for end-user applications. It's also nice for dual-licensing.
Licenses aren't something to get ideological about; it's more of a right-tool-for-the-right-job kind of thing. If you use a hammer with screws, you'll get hurt. Same thing with using BSD where AGPL fits, or AGPL where BSD fits.