I use windows as a temporary collection of related things. If I'm researching a purchasing decision, for instance, I'll have a tab with the Amazon listing and a bunch of tabs containing information/reviews about the item. But I only need that for a couple hours, then I want to easily dump everything by closing that window. And I want to be able to easily find just my research info by scanning my open windows. Spaces are too permanent for that use case.
Another way to say that is that Spaces need their own windows sometimes, too, and Arc deals with that scenario way worse than a traditional browser. They need some "in-between" solution if they don't want users needing multiple windows, or they need to handle multiple windows better.