I guess the question then becomes, what problem does a multi-tenancy setup solve that an isolated database setup doesn't? Are they really not solving the same problem for a user perspective, or is it only from their own engineering perspective? And how do those decisions ultimately impact the product they can surface to users?

Off the top of my head, managing 100 different database instances takes a lot more work from the business standpoint than managing 1 database with 100 users.

The article also mentioned that they isolate by project_id. That implies one customer (assume a business) can isolate permissions more granulary.

With multi-tenant vs multi-database decision one driver would be the level of legal/compliance/risk/cost/resource drivers around how segregated users really are.

Multi-database is more expensive generally but is a more brain dead guaranteed way to ensure the users are properly segregated, resilient across cloud/database/etc software releases that may regress something in a multi-tenant setup.

Multi-tenant you always run the risk of a software update, misconfiguration or operational error exposing existence of other users / their metadata / their data / their usage / etc. You also have a lot more of a challenge engineering for resource contention.