If you just want to execute it then it is a footgun - using only the !command syntax.

If you use the !command:p syntax then you are just printing what command has been executed instead of invoking it.

Example.

    % uname
    FreeBSD
    
    % !uname
    uname
    FreeBSD
    
    % !uname:p
    uname
    
    %

I imagine that how it worked for them before is that the up arrow would move the cursor to the previous line into the output of the previous command, while feeding the arrow key escape sequences to the shell prompt as part of the command. IOW, a pretty useless and annoying key right? Why even press it? How did they notice readline?