Is this API needed? I understand the benefits, but web apps or Chrome extensions that _really_ need file access can already use the Native Messaging API and ask the user to install a native app, like here:
https://a9t9.com/kantu/x#fileaccess
The advantage of an explicit app installation is that users/companies that want to avoid such file access (and the many other things that native apps can do) can simply avoid/block app installations.
In the last two decades users have learned that "as long as it's inside the web browser, it's safe". If web apps themselves become too powerful this security approach breaks down.