It being FOSS is an advantage to some folks. Obsidian doesn't allow you to use it for business for free unless you meet specific criteria like having 2 or less employees.
You openly acknowledged that Obsidian isn't open source. There's lots of open source software for Windows and macOS, yet neither Windows nor macOS are open source. Strange counter-argument in which you proved my point.
Name these FOSS apps that use custom formats. There's so many Obsidian-likes that are not only FOSS, but also use non-proprietary flat markdown files. It sounds like you're drinking too much of the Obsidian community Kool-Aid and trying to convince yourself of these things that simply aren't true.