>With that said, I have to ask why these groups are interested in 10-bit

I can explain that - I wrote an extensive post on this matter a year back, so I'll just reuse that with a bit of tweaking. So with that clear, let's talk about the medium we're working with a bit first.

Banding is the most common issue with anime. Smooth color surfaces are aplenty, and consumer products (DVDs/BDs) made by "professionals" have a long history of terrible mastering (and then there's companies like QTEC that take terrible mastering to eleven with their ridiculous overfiltering). As such, the fansubbing scene has a long history with video processing in an effort to increase the perceived quality by fixing the various source issues.

This naturally includes debanding. However, due to the large smooth color surfaces, you pretty much always need to use dithering in order to have truly smooth-looking gradients in 8-bit. And since dithering is essentially noise to the encoder, preserving fine dither and not having the H.264 encoder introduce additional banding at the encoding stage meant that you'd have to throw a lot of extra bitrate at it. But we're talking about digital download end products here, with bitrates usually varying between 1-4 Mbps for TV 720p stuff and 2-12 Mbps for BD 720p/1080p stuff, not encodes for Blu-ray discs where the video bitrate is around 30-40 Mbps.

Because of the whole "digital download end products" thing, banding was still the most common issue with anime encodes back when everyone was doing 8-bit video, and people did a whole bunch of tricks to try to minimize it, like overlaying masked static grain on top of the video (a trick I used to use myself, and incidentally is something I've later seen used in professional BDs as well - though they seem to have forgot to properly deband it first). These tricks worked to a degree, but usually came with a cost in picture quality (not everyone liked the look of the overlaid static grain, for example). Alternatively, the videos just had banding, and that was it.

Over the years, our video processing tools got increasingly sophisticated. Nowadays the most used debanding solutions all work in 16-bit, and you can do a whole bunch of other filtering in 16-bit too. Which is nice and all, but ultimately, you had to dither it down to 8-bit and encode it, at which point you ran into the issue of gradient preservation once again.

Enter 10-bit encoding: With the extra two bits per channel, encoding smooth gradients suddenly got a lot easier. You could pass the 16-bit debanded video to the encoder and get nice and smooth gradients at much lower bitrates than what you'd need to have smooth dithered gradients with 8-bit. With the increased precision, truncation errors are also reduced and compression efficiency is increased (despite the extra two bits), so ultimately, if you're encoding at the same bitrate and settings using 8-bit and 10-bit, the latter will give you smoother gradients and more detail, and you don't really need to do any kind of processing tricks to preserve gradients anymore. Which is pretty great!

Now, obviously most people don't have 10-bit screens or so, so dithering the video down to 8-bit is still required at some point. However, with 10-bit, this job is moved from the encoder to the end-user, which is a much nicer scenario, since you don't need to throw a ton of bitrate for preserving the dithering in the actual encode anymore. The end result is that the video looks like such an encode on a 8-bit (or lower) screen, but without the whole "ton of bitrate" actually being required.

So the bottom line is that even with 8-bit sources and 8-bit (or lower) consumer displays, 10-bit encoding provides notable benefits, especially for anime. And since anime encoders generally don't give a toss about hardware decoder compatibility (because hardware players are generally terrible with the advanced subtitles that fansubbers have used for a long time), there really was no reason not to switch.