At an earlier point in the game development, Eccma made it so when overencumbered, Lona move at a snail's pace = guarranteed death unless you enter inventory and drop items on the ground (items disappear over time when dropped). Not sure why he changed this.
For my immersion, I never used this exploit but it's legit anyways since Eccma never changed it back.
As I mainly play Doom difficulty now, I personally almost never go over Lona's carrying capacity. Honestly, it is too costly to go over Lona's carrying capacity. The STA wasted along with the food and the time wasted recovering the STA, its just not worth it. But don't get me wrong, there are some genuine uses for it.
Pros:
1. Lona Burns through a lot of STA and food which means she will be passively gaining exp fast.
2. Basically unlimited Carrying Capacity until you reach the game's item limit.
3. You are always prepared.
Cons:
1. Lona is burning through a LOT of STA and Food which is usually bad for combat situations.
2. Lona requires a lot of food to sustain this state.
3. Lona wastes a lot of time recovering STA and traveling on the map uses so much STA as well.
4. Lona is more likely to lose to drawn out fights due to constant STA loss.
Some Use case for being overencumbered is when you are trying to grind levels in an infinite farming area. Places like the catacomb and bar fights are places where you can use it to grind fast exp.
Other than that infinite storage is nice. But i dont think the cost is worth it unless you are filthy rich.