The system was put so players were about even. Meaning those who play only a few hours to those who play more often.
One issue in ffxi, is player lvled up too fast in some cases and always had to play catch up.
Then lvl sync came and ppl abused this to do smn burn pts.
Pretty much you have all these high lvl players who are clueless about the game and had poor skills.

Also it was to entice player to play all of the classes. And like ppl said, it is the WoW system, just in reversed. You start out rested then slowly get fatigued. It does add a sense of immersion if you think about it. You level up (work) say 8 hrs then take a break and do other stuff. Like the story on the main site about Leeroy. Like say you was fishing for a while, your buddies wanted to explore the local dungeons. You do that for a while then go relax and sharpen up your gear, then maybe do a bit of cooking.

The only reason no one likes it, is it slow them down in hiting "end game". Well once it gets added. Which I'm happy about.