For me this feature is dedicated for legacy devices who are only capable (or work best with) PSK. A central PSK on the other hand is a huge risk as soon as the key gets leaked.
For me, individual PSK combines the advantages of both (centralized PSK and 802.1x) with slightly less security than compared to 802.1x.
* easy configuration (no extra radius server, everything configured on controller/AP) and less complexity (only controller and APs must work, not external server needed etc.)
* the device uses it’s known PSK mechanism (it does not see any difference to centralized PSK)
when the administrator wants to get rid of a device, he simply deletes it’s PSK.
* divide each device in different VLANs (per device like authentication)
The use case for me is to set up a new VNS for all these legacy devices (only WPA2-PSK is supported) and configure individual PSKs for each of them. The devices will work best and the administrator has more tools to get rid of one of them. Domain-joined Windows devices are still handled by another VNS which uses 802.1x with certificates.