Is it ideal? No. But it's the config of choice if you're attempting to manufacture the cheapest possible design that would use the least materials and still light an LED(s).
That's why you see it as the dominant <$20 LED config coming from the far east.
AAA are not popular here in the west. But the side/side offers a reasonably small diameter barrel and short length.
Although I find the 3 cells a PITA, the form factor is very comfortable if you have small hands and it does allow the light to get into very tight spots like engine bays, and under the dashboard. It does better than a standard 2-3D Mag, and 2AA tube flashlights in tight spots.
I was an early adoptor when I first got one with 3 5mm LEDs. I thought how much better it was than a MiniMag. It got modded with a 1W Luxeonstar and Fraen LP collimator. I power it with 850mAh NiMHs through a 1 ohm resistor, and it yields a lot of light for 1 hour and tapers off. For most jobs, that's plenty, and it survives a beating....rolled off a rooftop, dropped on concrete, and ceramic tile, dunked, thrown, and hasn't failed in 3 years. The KISS principle applies well here. A PCB would likely have been damaged. I don't think a L1P would still be shining if exposed to what I put mine through.
And the reason I would put mine through such conditions is that it's expendable compared to more expensive lights in my collection. Afterall, you don't wear a tuxedo to go clean out a barn (I hope)
These lights are now cheap as dirt, and some are decently made with very bright 5mm LEDs. And for a little more, a genuine 1W Luxeon can be had, like the Lowes' offering with a very stout body.
I have several 3AAA LEDs that I hand out as loaners. To the average person who couldn't give a hoot about flashlights, they still impress, and the size and price is favorable. And if they become like me, may start down the road to flashaholism.
My favorite is a 2AA, and I have several end-to-end models, the most $$ being my XM-3. But I find them too long. A side-by-side 2AA with regulation and 1W Luxeon in a Zippo lighter style would be a nice EDC.
But this gets away from KISS design.