That meant, for example, that, after backspacing over a return, you could end up with a paragraph of text with, somewhere in the middle, a “set left margin to 3 cm” instruction, or with multiple conflicting instructions (I think neither was supposed to happen, but all software is buggy). I didn’t use WP, so I wouldn’t know what that meant for the paragraph being laid out. It might have been applied starting at entire paragraph that contained the instruction, at the next paragraph, or immediately.
The ‘raw view’ didn’t only allow you to see the (potential) mess of formatting instructions, but also to edit it.
So, if you knew your way around there, you could fix any problem with documents.
IMO, if WP were less buggy, it probably wouldn’t have needed that mode. I also think its existence put less pressure on WP to fix bugs.