It offers privacy too. With encrypted DNS, you can only see that the source IP is making a request to the destination IP, not what type of request or what it contains.

If the source device then connects to whatever IP was in the answer, and you have that IP mapped, then you can reveal what they might be connecting to, but that requires more data and processing compared to plaintext DNS and still won't reveal the actual encrypted traffic.

With shared IPs from CDNs, hosting providers, and VPNs, it provides far more obfuscation for the average user.