As a secondary nitpick, the term is perfectly acceptable for the process commonly used today. As you’ve already mentioned - the original process has been lost to time, so no one actually makes it.
Agreed. There was a much smaller emphasis on Damascus steel in early seasons. If you go back and rewatch you can see the frequency pick up as they praised and required Damascus more and more.
On top of that, I believe it is easier to run into problems with delamination, or that a small flaw can more easily be a larger problem.
If anything, it seems like an added challenge to demonstrate that you can do it, as a way to distinguish the blade in the final judging if it performed similarly to the others.
Ultimately, though, it's still just showmanship and not an actual indication of the quality of the blade itself. It's a TV show, after all.