Arkenfox does far more than that, just look at the user.js. Among others, it spoofs the time zone, number of cores, window size and many other attributes that assist fingerprinting. It basically mimics the settings of the Tor browser.
https://www.ghacks.net/2018/03/01/a-history-of-fingerprintin...
The flag was in fact designed to control the activation of the Tor browser uplift features, and reduce maintenance issues. That way the Tor browser could pretty much just be Firefox with certain flags turned on.