I absolutely 100% do not understand it either. At all. Every time I try to over the last year or two I come away with the conclusion its something that sounds cool (to me too!) but is guaranteed to cause more problems than more obvious solutions.
That being said I'd kill for someone who used it and benefited to explain it to me in a practical sense. (specifically where syncing is involved, and syncing a subset of the SQLite is necessary. If it's "just" a document store thats treated like a blob for syncing/backup, that's familiar. If it's all in one storage but only local, that's familiar.)
Re: TFA, I guess it would have helped if I knew what Obelisk was, which is on me, and a more in-depth explanation of how this ties into AI/agents, which is on the industry/writer.
It's very likely that you have multiple SQLite databases in your pocket right now. It's one of the most widely deployed pieces of software on the planet. If your conclusion is that it's guaranteed to cause more problems than other solutions, then that's on you.