When singing up for something that is after an email address, the prompt for an email address that Apple populates the box with is the list of addresses for the contact and the option to create an email address that is only used for that service and forwards to your own email.
In a world where email address lists get sold, using the random address generated by Apple means that if that provider sells the list, you can disable the random address without exposing your real underlying address.
https://support.apple.com/en-us/HT210425
In a world where email address lists get sold, using the random address generated by Apple means that if that provider sells the list, you can disable the random address without exposing your real underlying address.