The article describes using pretty much any IDE, so they are just offloading the setup and running of the development environment to the cloud while letting you run your preferred IDE locally.
People who try working offline are exactly the people who want to do it without Stackoverflow.
My company has a remote VSCode setup not that dissimilar from this setup. Big C++ codebase. Many engineers love it, even some of the "old timers." Our interns can be productive on day one and it brings a lot of productivity to not have to worry about caring for your dev environment.
But there are plenty of people who really just want to SSH into a beefy desktop (or directly edit on that desktop) and use their vim/emacs setups. These are the people who know how the whole build stack works, can debug the vscode/codespace magic, and can do amazing things not available in the VSCode plugin library.
So it's good to be able to do both. Allow power users to use their own tools, but don't require everyone to be a power user to sit down and write some business logic. Give nice rails to ride but don't require them.
I bet smaller/poorer companies may want programmers who are ready to fix tooling when it (inevitably) breaks
Additionally, it's not like developer set up is the only thing that test your ability to manage frustration. I would say developer set-up is just something you need to get through to start your actual job, and if that can be eased up then it's worth it imo.
For smaller/poorer companies, they could always hire an engineer that specializes in fixing broken tooling. Ultimately it's a company's job to hire competent engineers.
Thinking back to all the times I had to set up my workspace, I wonder how much did I really learn vs just Googling and getting quick fixes.