My bikepacking kit of handlebar harness & bag (13L), frame bag (4L) and saddle harness/bag (13L) gives me slightly more capacity than just one of my pannier bags but distributes the weight around the bike a lot better. Actually the weight isn’t huge, depending on time of year, temperature, etc. it’s usually somewhere between 4 – 8 Kg.
The heavy denser stuff is in the frame bag. The handlebar bag has sleeping kit in it and even for winter it weighs less than 2Kg. While I can use up to 13L in the seat bag it’s usually about 8L of clothes.
If you have to do any hike-a-bike then the bikepacking setup is much easier to handle than panniers.
It’s quite possible that when bikepacking started the bikes didn’t have mounting points for racks so the early participants looked for a different way to attach bags. It’s not new though – Australian itinerant farm workers had similar setups way back in the late 19th century.
Edit: I should say that I do have rack and panniers and for on-road touring they’d be my first choice.