It's not wrong with regard to water impenetrable surfaces such as metal and plastic, and not wrong when applied to well painted wood siding, even unpainted shingle and shake siding. Sure, people used tarpaper to keep the water out, it was cheap compared to putting siding on. People skipped the siding because of poverty not because of something else. Everyone wants to argue about brick walls, but water seeps through brick, so you need drainage holes. Brick is great for long term wear, but the multitude of joints leads to water penetration, so construction needs be in accordance. Wooden shingles, for instance, shed water. Hell, I use to see light through small cracks in shingled roof of our house (no ceiling in the upper story) when I was little but rain and snow never penetrated. There was no tarpaper between the shingles and the wood structure. Heck, how old do you think tar paper is?
Sure is does those things, but the marketing is for reduction of air flow. Most houses that I see constructed without Tyvek do not have any kind of wrap and certainly tar paper is never used as a wrap. Small pieces of tar paper may be placed at strategic points around window and door openings and much of the sheating is water repellant, e.g., foil covered foam. But the plywood pannels used for strength are never covered with tar paper. Of course exterior plywood is used and the glues are water repellant. However, I don't see any treatment of the joints between pannels. If water penetrates the siding it will wet the sheathing, the frame, and the wall insulation.