Pat:
You are very astute. The bare wood finish is most common for architectural work, both interior and exterior, including joinery.
For example, the house I am currently renting is about 25 years old, and has wooden pantry doors in the kitchen. Side by side doors on bottom and top, a total of 8 feet high, and made of Akita sugi cedar, a slightly reddish brown softwood commonly used as construction lumber. The boards are full of knots, but have not warped due to multiple cross battens on the inside secured with glue and staple. I did not make these, and they are not especially well made. They were not finished with a handplane, but are right off the thickness planer. But the point I want to make is that they were not sanded, and no chemical finish of any kind was applied. The wood around the knobs is scratched by fingernails and has some oil stains. My wife has never cleaned these doors in the nearly 5 years we have lived in this house.
These defects do not bother me or my wife. I know that if the doors had been sanded and painted a pretty white when new, they would look a lot worse and be a lot dirtier about now than the unfinished wood does. I like the bare wood, and while I would not have tolerated dings and scratches and stains when they were new and smelled wonderful, the defects do not make the doors ugly or seem dirty in our eyes.
But, if we wanted to clean them, a damp rag and some elbow grease would make them look spiffy. Not so if the wood had been sanded.
If push comes to shove, I could always plane these doors to refresh them, but I won't.
I point is that everything made of wood we use daily gets dirty and dinged over time, and that bare wood holds up pretty well in many, but certainly not all, circumstances.
In the case of furniture and countertops and light fixtures, bare wood is still an option, but for the reasons you mentioned, most people prefer a chemical finish. High-build film finishes are not all that popular in Japan, I think. People still want to feel the grain. My dining room table is made of solid nara, very similar to white oak, and has a urethane finish soaked into the grain with no apparent film on top. It is a good finish with nothing to chip or scratch off and has endured a tremendous amount of abuse from my careless wife. But eventually she will burn it, and then I will plane it to freshen the surface. Maybe I will leave it bare. I will not sand it.
Stan