Useless LEDs that burn battery budget.
The thing everyone seems to be missing is this isn't a laptop for you or me. It is to compete with Chromebooks in the educational market, and to have a SKU to sell in developing countries.
As for the importance of it, if you want to give these to kids, you should have something more rugged, more replaceable, and more built for all kinds of environments (including kids who don’t have a conveniently well-lit place to focus on schoolwork at home).
A large school could have thousands upon thousands of broken Chromebooks waiting to be shipped off - literally multiple pallets. I’ve seen it more than once. Absolutely nobody is begging for an unrepairable, unexpandable, more-expensive version of what they all already have. It’s garbage for school, dead out of the gate.
I wouldn't normally comment on such stuff as it's clearly a personal preference, but just to underline that it is in fact a preference vs everyone, I have used keyboard lighting exactly once in the ~decade it's been available to me. On a laptop with predictable keyboard, it genuinely doesn't matter to me.
(On a laptop with unpredictable keyboard, light is mitigating, not fixing the problem :)
Touch typing is a useful skill for everyone to have and doesn't take long to acquire.
Not to mention even the light of the display should be enough for you to be able to read the key caps if you really need to. Keyboard backlight seems like a gimmick with limited use to me. I always thought it was purely aesthetic.
The backlighting is useful. But no, it's not for typing, for most people.
Even in my home country of Portugal 700€ is a lot to throw at a ‘laptop’ that will be somewhat obsolete in 3–4 years, assuming Apple continues the trend of graphics-intense, memory hungry OS releases. An iPad seems like a better candidate for students or those on a budget.
I’m actually not sure who the Neo is for. Unless it’s a 3-model trick to price the Air upwards.