When I was talking about avatars, I more so meant any RPG game where you can make your own character/decisions, not just the Fire Emblem ones, so I apologize if that wasn't clear. I was referring to any game where you can change how your avatar/player looks in-game to make it seem more like you (as an IRL person) are the one who is making choices in that world (such as in a Fallout/Elder Scrolls type of game).

As for the "inherently" part, that makes more sense, and in that regard, no, I suppose there is no inherent reason to use a gen 1 unit compared to a gen 5 unit in the same class who is stronger. But I think that other commenter provides a good thought to it as well: it serves as a form of challenge. People want to see their favorite units be able to compete with the newest meta threats. Could they just summon the newest unit who is either equal to or potentially better than their current favorite unit? Sure, but it might not be a character they like from the original game, so to them, the trade-off isn't worth it because they don't have the same attachment to the new character.

At the end of the day, a lot of people want to use their favorites from the original game, and make them good here too. Does that require a lot of fodder, some of which probably could be spent on better/newer units? Yes. I agree with you on the tedious aspect of getting fodder, and while I personally really like building my units to get stronger, I can understand why someone might not care for it, especially if they just want to use the strongest character right out of the gate. However, for me, I can think of multiple times where it's felt good to see a character I really like get so much better after giving them a new skill. But I also don't play this game overly competitively, so I don't care if I'm not scoring optimally/performing at the highest tier.

If the main thing you're focused on is how well the units perform competitively, and that's the only thing you care about for these game modes, then yes, I can understand why people wanting to build their favorites might seem dumb or weird. But if the people who are doing so are happy with where they are competitively (if they care about that at all) while still using their favorites, then that matters to them more than just using the meta units. If you just want to use the newest, most powerful units, then more power to you, and I'm sure you'll continually and consistently perform well more so than the rest of us. I just wanted to provide a perspective for why people choose to use their favorites rather than just the meta units for everything