I can think of a few reasons why a company built on profiling (and advertising to) user interests might be interested in the private conversations of their users
In that case, why introduce the feature in the first place?
There is a product reason - AI features are fundamentally incompatible with E2EE. If they want to bring more AI generated experiences and content into Instagram then the data needs to be accessible by them.
That's an interesting angle. I'm not sure I see the direct connection, but it can be a user choice.
I can think of some. Less code complexity to support a feature that didn't work properly and nobody was using? More ability to detect spam?
Wasn't it automatically used when it was implemented?