You can't loop a .wav infinitely (in most music players), you can't mute or isolate channels, change playback speed or pitch or sample interpolation, mute or replace samples, extract score data from the game engine, study how the game engine drives the SPC700 hardware...

In the same sense there are a lot of advantages to storing your traditional music in the format of its original DAW project files, but wouldn't you agree that's impractical for listening purposes?

It's not impractical, there are certain music players (winamp/foobar2000 plugins, some mobile players) which make managing a library of emulated music as easy as managing regular music in those programs, with orders of magnitude smaller files, and added features like endless looping (which is an important feature to looped game music, but less so in commercial music). One reason it works well is because console sound dumps are self-contained and take up two full orders of magnitude less space than the recordings (because they're taken from consoles with small memories), whereas DAW project files often depend on large sample libraries and external VST plugins, taking up more space than the recordings and often come with setup/DRM issues.

There are flaws, like PS1 sound dumps often coming with wrong volumes and echo, but then again most recorded versions of those songs were also generated through inaccurate emulation, then fed through lossy codecs, and some have playback/recording glitches.

Those kind of files aren't the rendered audio, they're more akin to MIDI files, but specific to the SNES synthesizers. So they have a vastly smaller file size, and contain more semantic information, than a wav/flac/etc.