That… is not very useful. If you have a 100GB .iso (as some recent games) that you need to install, you now need 100GB x 3. The .iso, the extracted folder, then the installation. I’d rather have the simple easy step any other OS allows, which is to mount the iso for reading.
Yes. But when you install a game that is in an iso, you need to extract everything, because everything gets copied during the install. The years of the main install files being copied and the video files kept on the .iso are very very long gone. So again, this is not a useful method unless .iso files are rather small, and when they are, it’s still extra steps.