This point feels like arguing why any organization would seek density in computing if they can just buy more of something and spread it out. I don't know about you but I've saved a ton of effort on design complexity by not distributing workloads when it can be avoided (but distributed computing is a solved problem).

I recognize what you are calling out/that performance will be the same on some workloads if you distribute or not. I would just point out less manufacturing causes less e-waste/I would rather live in a world where Nvidia sells 50 million 10*0 cards, than 500 million 1030 cards to create the same amount of compute in the world. It's not just the power costs to consider (but it could be there is a reality where running 500 million 1030s for their lifetime wastes so much less power, that the manufacturing costs to the planet are worth it).

Your point is rooted in wrong facts. On-chip fabrics are much more efficient than separate computers over ethernet. More energy efficient and lower latency.

Not only that. On-chip gives you high precision synchronous time (all cores observe the same time) so you can use synchronous distributed algorithms that are unsuitable for ethernet networks.

This type of hardware allows for much better solutions to some problems.

Latency! Nanoseconds versus microseconds or even milliseconds makes a huge difference.