Can anyone think of a single advantage to this window-in-window format?
Yes: it's easier to port software from the DOS era, or pre-multi-tasking Windows era, that assumes it owns the whole screen. Oh, wait, you mean advantages for the
user of the software? No, not really.
Well, in fact I suppose it's also easier to "port"
users' experience of software from earlier times. If you use Windows like an Iphone -- if all your windows are always maximised, and you use Alt-Tab to go and find Excel when you want to do some excelling, then Alt-Tab to go and find Word when you now want to do some wording, then MDI is the thing you need.
When cutting and pasting between separate instances of Excel, formulas are pasted as values only, whereas in the window-in-window version, the formulas are carried over.
That's nothing to do with MDI as such, of course, it's just down to the fact that they're separate instances of Excel. A proper multi-SDI application like Word (probably) is, can run several top-level windows from the same instance.
Faking that by running new instances for each document (
here's how to do that for double-clicking Excel files) will use a bit more memory than one-instance-for-all -- but far less than the N times as much one might expect, because all the read-only and/or relocatable-code memory pages, such as the program code itself, will be shared between them.
Peter