I can assure you, they got a lot of use in the 90s, and they were used for exactly the same reason people still make separate accounts for their family members on their computers today. It's not about security. It's about keeping separate preferences.
Your hypothesis that XP somehow forced the concept of separate accounts on regular home users because NT was used on servers is just bizarre. People who wanted separate accounts were doing it on 98, and people who didn't simply ignored it and all shared one account. The UX for different family members sharing a single computer by signing into it existed before the NT kernel was in use around the home. The implementation changed when Windows went to NT, but the UX did not. And given that the UX of separate accounts was already appreciated by users, the more robust implementation made possible by NT was a no brainer.
>Mobile OSs got this right: on a personal device,
When it comes to a PC, "personal" is a misnomer. Failure to understand that is the root of your confusion. You are presumably at a place in life where your computer is your computer, not shared with others, like your cell phone. But when it comes to PCs, that perspective is a privileged one. It's evidently not important to you that numerous people be able to use your computer, but it is important to others. The UX of the device that lives in your pocket needs to be different from the UX of a device that sits in the middle of your living room for the whole family to use, like a television.