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Users want a local app for no real reason, as evidenced by the thousands of apps that are nothing but a wrapper around a web application.

At minimum, it provides a convenient bookmark on the home screen.

If the users want native notifications, which most do, then developers have no choice but to release a native app because Apple purposely doesn't implement web standards on iOS that make web apps and PWAs usable.

The web is a thin client, to an approximation.

How does this solve the problem of letting customers run a fat app without forking over for the corresponding server horsepower to run it? I know that JS is high performance when written well, but it takes time and money to do it right.

Or just switch to a platform that allows third party apps

If the platforms are equivalent in functionality, then why can't Apple let people freely sideload native apps?

Who claimed the platforms are equivalent in functionality?