It stores everything in binary logs, however your old system didn't store it at all. You had a daemon (syslog, rsyslog, etc) that wrote them as plain text. If you start those daemons, you at exactly the same spot as before. Just with an additional copy in a binary log. Which btw, journalctl can do some magical things, and you should take some time to play with it.
systemd is not monolithic, or at the very least its a distributed monolith. The vast majority of services happen in their own userspace process.
Systemd excels with servers, since it standardizes how their execution gets defined. It takes only an added line to spawn them in their own namespaces, set cgroup restrictions, prevent network access, etc. Before hand, doing these things was very hard, so no one did them.