I totally get the peace of mind aspect, knowing where it is. But I don’t believe it helps me getting my luggage back if it is „lost“.
Imagine the worst case: the luggage fell down some escalator somewhere during transit. Or somewhere on the runway. And you then see it lying THERE! I SEE IT! How would the lost luggage counter contact a person picking up the luggage from there? I don’t think there are processes in place for this.