I can see how it might not be the solution you want for home but at work I'm just trying to get things done and that unfortunately involves a large number of passwords that can't easily be federated into an SSO like okta because they span businesses clients and companies. I don't understand the hate for LastPass, for me it just works (tm)
Prime example of Lastpass security theater - what exact problem did they think this feature solved?
Sure, its not too hard to get around that feature, you could just inject your own javascript on the page to dump the contents of the password field. But it does block the low hanging fruit of the millions of users who don't know how to do that who might abuse having access to the password because they don't really know better.
In essence, it helps to prevent those users who don't know better from leaking the password to places it shouldn't be. Obviously it doesn't prevent people who know how to get around it from getting around that protection, but in those circumstances you shouldn't really be sharing your password with someone who will abuse your trust.
Are you arguing that because they might make mistakes elsewhere we shouldn't bother putting any barriers up to them breaking policy, and that the only thing we should do is more training? I'd argue both things should be done. I do agree preventing LastPass from directly exposing the password isn't a very strong protection, but lets not act like it doesn't prevent any kind of password abuse. Sure, users should be more trained, but we should also create more barriers to prevent them from shooting off their toes.
It almost sounds like an argument to get rid of barriers on highways. Drivers should just know to not drive off the cliff; if people are driving off the highway clearly all we need to do is train them more. Barriers are just safety theater, people might still end up driving off the cliff if they try hard enough!
You asked for a use case for this feature and I gave you a use case that happens all the time and which such a feature prevents a large percentage of those users. You'd need someone determined to break the policy to dump the password and share it someplace they shouldn't, as opposed to someone doing it without thinking "is this against policy? shrug"
Is there anything that stops someone from letting LastPass fill the field, then use the browser tools to change the form field from `password` to `text`?