In Ki Aikido it can be used as a way of developing center and thus learning to move from center and develop power from center for you can't rely on legs. Physically it also teaches how, now that your legs are 'missing' how useless it is to just rely on your shoulders and brute strength and so you learn how to develop hip movement. Subtle hip manoeuvering to generate power.
Put very, very, simplistically and physically you could call it wrestling from the knees or even judo from the knees if you like.
Well Graham, that's exactly what I find myself thinking all the time during bjj rolling from kneeling "now that my legs are missing where is my center" and how can I generate power. I never relied on brute strenght. In my previous traing all of the power came from the hips, snapping them etc, I still use that when we start from standing position but when we start from kneeling I have not been able to generate much power and have felt generally double weighted. As you and Matthew pointed out we can still use the hips with this technique and therefore can generate power. Thanks a million for clarifying this. It is making a lot of sense.