Still confused here. What is the actual, concrete ‘as-a-user-I-want-to’ application for which this is meant to be an ideal fit? Sorry if a dumb question.
This is a protocol for generic shared information spaces, where each person still owns & can manage permissions for their pieces of data in the space. It's a general idea that's present & implicit in most existing online spaces.
Syncthing is designed specifically for file system sync (and does a very good job). Willow could be used for file system tasks, but also for storing app data that is unrelated to file systems, like a KV store database.
You should be able to write a good syncthing like app using the willow protocol, especially if you choose blake3 as the hash function.