A user of Blender can absolutely point at an arbitrary part of a rock wall and say "move this over and make it bigger". Blender sacrifices rendering quality to make sure that interaction is reliably responsive. Cube/Sauerbraten forgoes some of the rendering optimizations provided by some other 3-D game engines to make sure you can always edit any part of the environment at any time, but it was already delivering interactive frame rates 20 years ago. And of course Minetest has very little trouble with arbitrary sets of nodes appearing and disappearing from one frame to the next, but Minetest isn't that great at performance, and its expressiveness is a bit limited compared to Cube and Blender, so maybe it's a less compelling example.
As long as it doesn't cause a glitch in playback, it's acceptable for your DAW to delay 10 milliseconds to figure out which note you clicked on. That's about 100 million instructions on one core of the obsolete laptop I'm typing this on. As you obviously know, that's plenty of time to literally iterate over your hundreds of thousands of little rectangles one by one, in a single thread, testing each one to see if it includes the click position.
But (again, as you obviously know) you don't have to do that; for example, you can divide the screen into 32×32 tiles, maybe 8192 of them, and store an array of click targets for each tile, maybe up to 2048 of them, but on average maybe 64 of them, sorted by z-index. If a click target overlaps more than one tile, you just store it in more than one tile. When you have a click, you bit-shift the mouse coordinates and combine them to index the tile array, then iterate over the click targets in the array until you find a hit. This is thousands of times faster than the stupid approach and we haven't even gotten to quadtrees.
A different stupid approach is to assign each clickable object a unique z-coordinate and just index into the z-buffer to instantly find out what the person clicked. This requires at least a 24-bit-deep z-buffer if you have potentially hundreds of thousands of MIDI notes. But that's fine these days, and it's been fine for 25 years if you were rendering the display in software.