I agree that it does have its limitations, but databases are all about trade-offs.
Talking about the "correctness" of a choice between tradeoffs is weird though. Running your database on hard drives nowadays is not a great choice - yet people still did that because the cost of hard drives was way cheaper than that of memory.
Running your database in a way that doesn't guarantee that a 'committed' response actually retains the changes that it was responding on - yet people still ran their database in such configuration to scrape the barrel on performance.
All Neon does is put up another option: If you don't mind the implications of networked storage, then here's one database system that has zero-cost cloning and does not lose data on single-node failure.
The latency of NFS & EBS or EFS is actually the reason many businesses *do not* use them for their databases.
I've seen deployments that had to go bare-metal because the tiny latency of EBS caused their compute times to rise exponentialy (doing AI training).