It's the same logic as writing a sentence like this:

Y U gna be late

It's grammatically completely incorrect. But you can still understand it.

When it comes to chinese/japanese characters, many have the same phonetic reading. So you can do something similar, while selecting the wrong characters.

I think it's just easier for beginners (or teenagers) to go from phonetic to meaning. I guess advanced Chinese readers don't even read the words out loud in their head and go directly to meaning. I'm beginner/intermediate at Chinese and surprisingly, I noticed that my pinyin often seems better than many Chinese natives.

It sounds like the Chinese version of 1337speak.

The real answer to your question: the most commonly used Chinese input method allows you to type the first pinyin letters only, and the algorithm will figure out the most likely Chinese characters you want.

It's not "the parents" can't read it. It's that people who don't use electronics have a harder time reading it.

Read the nonsense text aloud and then listen. Presumably with practice, you don't actually to actually speak aloud, and your 'inner monologue' voice is sufficient.