Why? For the same reason people insist on painting perfectly beautiful wood furniture- because they can.
My guess is the wood on the piece isn't intact. My sister had a funky old set like that when she was first married. The curved front had a veneer running vertically grained over the curved front. The dresser was in great shape, but the bedside tables were dried out, brittle, and chipping.
I agree the execution could have been better. The fabric choice seems to scream "the 1990's called and they want their cloth back". I also think, one such piece is plenty in any setting. Statement piece rather than suite. Covered in a vintage print it could have been adorable in a nursery or breakfast room. Covered in a subdued chevron, it would work as storage in a big but quirky bathroom.
It's funny, the last time painting furniture was a "thing", back in the late 60's-mid-70's, there was a smaller trend toward the use of fabrics and wallpaper on hard surfaces as well. Maybe we're headed there again. My aunt used a wallpaper to sort of decoupage a sofa table in the parsons style- it was done in a coordinated pattern to the stripe on the wall in her breakfast area. She got the idea out of BHG magazine's 100 Ideas Under $100 which was popular back in the day.
People sometimes upholstered walls with batting and fabric back then, too. It not only covered imperfect plaster and absorbed sound, it added a little insulation during the first gas crisis.