I think you overestimate how niche it really is. In the browser it's an essential part for many creative/productivity tools, e.g. Figma or Miro. On the backend it's used quite regularly as sandboxing mechanism or plugin system, e.g. Istio, Helm or OPA (so generally a high prominence in the CNCF ecosystem).

There are a lot more niche web standards that have a lot less usage that stuck around for a log time (e.g. the recent debate around removal of XSLT)