I've done this for practical use cases, like running a container inside another container that didn't have root privileges. It works fine for that use case. I'm not worried about restricting access of the process because it's already within a larger sandbox, I'm usually just trying to execute the command within the child container's filesystem (e.g. some vendor/partner software they ship as a container image).

I don't know why you're so shocked by this? This is all very basic use of the OCI spec.