I read the template for questions but only include what can be relevant for this question:
1.) I don't hate puppies
2.) rclone v1.69.0 on Ubuntu
I'd like to know the reason why a path is recommended after the crypt name?
Normally should contain a ':' and a path, e.g. "myremote:path/to/dir",
"myremote:bucket" or maybe "myremote:" (not recommended).
My use case is a local backup which will be synced to my google drive. The reason for the local crypt is that I want both a local and an offsite backup and figured that I can just as well encrypt locally since local transfers are much faster and renaming/moving files isn't possible with a crypt. So whenever I rename/move something, the transfers required will be over a faster connection and the sync from the crypt to google drive will be without unnecessary transfers as a consequence.
You do hate them as you didn't share any config so it makes answering your question tough.
Depending on your config, you'd be mixing non crypt and crypt content as you normally want that in a folder on a remote. Sharing all the details in the template makes is much easier to answer the question though.
The short answer on why use a path and not the root folder is because some cloud systems require certain folders to be there which would not be encrypted. It also allows the user to use both encrypted and no encrypted files in the same storage. As the crypt remote treats unencrypted files as corrupt files and filters them out.
So having everything in a folder eases the support and ability to separate both, specially as the file count increases.
Now, as Animosity022 expanded. If you need to clarify your use case scenario we will need more information.
IMO this is only important for cloud providers using their "drives" for variety of other services. Good examples are OneDrive or GoogleDrive. They will store and display content, often without end user control and it can interfere with rclone crypt operations.
In case of pure storage like for example S3 or Backblaze it is irrelevant how rclone crypt is applied as end user has full control of all content.