Also it puts consequently allocated objects (of different size) far away (and thus reduces cache locality), which, in turn may reduce performance for some "allocate a lot of stuff at the beginning and then serve it", etc scenarios, but this is pretty esoteric problem.

Benefits outweigh the concerns, so most apps benefit from the low-fragmentation heaps.

For short-lived processes, it's faster and uses less memory. The code is also simpler (important if you're writing a malloc in the mid-1980s).