It doesn't seem useful to everyday computing but I imagine there are niche scenarios where it could be valuable. Stenography comes to mind, or perhaps some machine control or clerical application where there are a limited set of input words that are valid and free typing is rare or disallowed.

A "sticky" modifier key (like caps lock, num lock, etc) that enables or disables it would vastly increase the value in a general situation though.

There are options to turn this off - build and flash QMK with the feature turned off. A hotkey to toggle the feature doesn't seem impossible either.

Sounds like a devious prank to pull on a coworker. Flash their keyboard with firmware that has builtin cloud -> butt, or their -> there and vice-versa

Agreed. There is just too many limitations for it to be ever useful, unless you build out a large dictionary with a huge CPU cost... A true waste of effort, albeit a fun one if you wanna learn QMK programming