It's so stupid, too. There is exactly one single case when I want my laptop to wake up with the lid closed: when I plug in the dock. Every single other case where it wakes up with the lid closed is a bug in my eyes.
Now the processor is kept powered on (in a low power state) but any poorly written driver or software can jolt the machine back into a higher power state and superheat your backpack.
Intel's rationale is that PC's should function like smartphones and you should be able to stay connected and receive notifications while asleep. I'm not convinced.
Fortunately I moved fully remote when COVID started so this hasn't been a problem and also switched to a mac last year - macs seem to be well behaved in this matter.