I don't quite get the justification of something like this over simply having more screen real estate. It's undoubtedly more expensive; is it just supposed to be a marketing gimmick to woo people? Or is there are reason why I'd want something like it?

Most people never use the function keys because it's too difficult to figure out what they do. So on many keyboards already you can't use the f1-f12 keys without a modifier, otherwise you get multimedia functions that are printed on the keys.

Having the functionality shown on the keys would help.

Also Apple is probably trying to create something new to get people to buy the hardware, that's how it works. Apple does try harder than most to make their features actually useful though.

If it could be the Dock, tap to launch/switch your own lineup of apps, that'd be slick and resolve the dock hiding versus vertical screen space problem.

More screen estate in the same space would mean a denser panel - higher hardware cost. Also would mean lower battery life - higher user cost.

I implied a bigger panel. Same width, but 16:10 instead of 16:9. This toolbar thing isn't free either wether it's literal money we're talking about or power consumption.

Well, if it's e-ink, there's no power consumption except when it changes. Plus it's probably a lot cheaper to find a small strip of e-ink panel (given the number of Kindles etc.) than to find a Retina-class 16:10 panel.

faster context switching maybe? glancing down at your keyboard is quicker than switching apps or bringing another screen up.

How is it any different from going from 16:9 to a 16:10 screen and using the extra space for the bar?

You also get the power of doing away with the bar itself and use the space at your own discretion too.