What do they do with all the honey? Is there any downside to us taking it? I don't know anything about bees.

They use the honey for:

- feeding themselves during the summer dearth

- feeding themselves during the winter

- to feed themselves in an emergency (think forest fires)

- to feed a large portion of them who will leave the hive due to lack of space and/or to reproduce the hive (swarming)

- to feed the whole hive ahead of abandoning it due to lack of space (absconding)

Honeybees have two stomachs, one that is basically a bag in which they can carry nectar (and honey) which they can deliver into comb cells and to feed larvae and the queen (who is too busy to feed herself), and one that they digest in and which they can't vomit up from. When they swarm/abscond they gorge themselves, filling both stomachs, and fly off with the queen to a new place, then they use all that stored up honey to make new comb in which to start making honey and new bees.

Feral honeybees need every drop of honey they make.

Domesticated honeybees -which are the same as feral honeybees, just in captivity- overproduce only because the beekeeper will manage their desire for space and reproduction so as to make them need much less of the honey they make, and therefore they have a large surplus that the beekeeper takes.

(Well, not all beekeepers produce honey. Some of them also or instead produce queens, nucs, hives, and/or propolis.)

They use it to keep warm and alive over winter.

Or a cold or dry patch. A weekend of torrential rain can put a dent in the honey stores.

Beekeepers typically replace it with sugar syrup which obviously lacks the nutrients they are evolved for. So you can buy sugar with additives.