I compare fingerstyle to driving an automatic with two feet, a hard habit to break. By exploring the different approaches we may find a few reasons. When working out of a four note chord such as a D-chord the thumb will move to the fourth string and the fingers will shift accordingly, leaving the pinky completely off of the strings. Melody is played by the finger assigned to the string. This hampers speed.
Players have no way to use alternate picking like a flat picker.
These up and down strokes would also help with deciphering rhythms. Doing without them is, indeed, like riding the brake. Classical players use this type of finger placement for arpeggios, but when it comes time to play melody the first two fingers will alternate, allowing for lightning fast playing and precise rhythmic variation. Classical players will even use three fingers on the same string to obtain a tremolo. Occasionally the thumb will interplay on the same string as the three tremolo notes.