I feel like I run into a new use for loopbacks every couple of months, but I'm not sure I fully understand them. Any advice?

I understand how I would, say, use a loopback plug to test and interface. And how you would use a virtual loopback interface to associate an IP to a physical T1.

I don't want to be too specific because I half way would rather not get doxxed with this username, but today I came across a Loopback with a public IP, and then a private IP addressed interface referenced it. I don't know why the physical interface just wasn't assigned the public IP. And I don't fully understand how a loopback works here. Again, I don't want to be too specific...but essentially traffic is sent to the public IP loopback, and then the public IP loopback relays the traffic to the privately addressed physical interface.

Does anyone have any idea what the benefit of that is? Is this a "transitional" configuration? It doesn't make sense to me when the public IP could have just as (more) easily been configure on the physical interface.

And that's got me wondering more about what I don't know about loopbacks instead of the specific questions I have about my last paragraph. Any suggestions, tips, advice would be awesome. I want to understand loopbacks better.