Phi-functions and block arguments are just different views of the same thing. Sometimes it is more convenient to use one or the other when thinking of a problem.

If you lay out phi-functions and their parameters on a grid, you'd get a "phi-matrix" where phi-functions are rows and block arguments are the columns.

If you don't do an out-of-SSA transform before register allocation, and effectively treat block parameters like function calls then you're pushing the complexity to the register allocator.

An out-of-SSA transform before register allocation would coalesce not just registers but also variables in spill slots (thus avoiding memory-memory moves), it would reduce the complexity of parallel moves. A more advanced transform could also hoist moves out from before the hottest branch which could potentially lead to un-splitting previously split critical edges.