Users can specify them by three points on the perimeter, by tangents at endpoints (up to 180deg of course), with various other conveniences (you can place two tangent arc or bezier vertices in a row and create an implicit g1 interface between the two arc / bezier segments).
Constraint solvers are good at circles and you can offset them analytically so they make a lot of sense for CAD.
I can't really say this rigorously but I also think that Bezier segments and circle segments are good "partners" for approximating smooth curves - each has just enough degrees of freedom for you to require g1 continuity between them, one of them always has constant non-zero curvature, the other cannot have constant non-zero curvature, and the locality aspect matches the intuition of a human operator.