There's no reason to ask for what you don't need and never intend to enforce. Unless you intend to selectively enforce it, in which case I'll assume you'll select me to do so one day.
Considering everything I work on personally was somehow web or media related, it felt very draconian to me at the time. But I still worked there and don't regret my time there overall.
The problem with that kind of trust is that sometimes the person who makes the decision isn't the cool guy. It can be the company's lawyers who decide to make your life hard after termination for whatever reason (reduces your negotiating leverage at least), or someone else entirely if the company is acquired (for example).
But as I said, despite my comment about him being pretty cool about things, it was enough to make me uncomfortable, and I didn't work on my stuff much, and definitely didn't release anything while working there.
They did have a 'we own pretty much every thought you have while you work here' clause, though, because it was a game studio and the owner's reasoning was you could have inspiration for game ideas for what you're working on pretty much anytime, anywhere...which he's right about, and he was a cool guy and I don't think he'd enforce the clause to actually steal other people's outside projects, but that clause still made me uneasy and I didn't really pursue my personal projects while I worked there much as a result.
But what you received is much, much worse.