Everywhere I look today, all modern games have some kind of upgrade tree system where actual progression in terms of tools and skill is substituted for grinding and the pointless gating of vital skills and content behind upgrades. If it's an AAA game of any kind, you'll be hard-pressed to find a game without one, and even then most indie games have them without them really banking on the possible benefits of such a system. I recently played games like RUINER, Iconoclasts, The Darkness 2, and Call of Juarez: Gunslinger, and all had the same kind of useless upgrade-point based progression. From developer interviews, I hear that the reasoning for the implementation of such systems is to allow the players to play how they want to play (in games which nota bene don't allow that much variety in playstyle to begin with) and to add some kind of replay value, though it's mostly the kind of NG+ which isn't different from most games without upgrade trees and the different playstyles offered aren't really worth a second playthrough.
The worst part is that most of them are all the same shit. It's either the kind of upgrade tree which requires you to grind into boring flat damage and health upgrades so you can survive encounters which you can't beat with skill alone because of the ridiculous damage scaling (or the kind of enemies against which you can only deal grazing damage until you grind moar, making it more an issue of tedium and padding of the game length because of the required grindan). When it isn't, it's usually the unbalanced kind of skill tree where some powers and upgrades are clearly more useful than the others, but because nobody really cares about balance in a singleplayer mode it never gets rebalanced properly, which kills the replay value since there's no point to speccing into more inefficient playstyles outside morbid curiosity. Even sillier is if you can respec at any time, which means your choices don't have any weight to begin with and there's no real point to builds.
The entire point of stat or upgrade node-based progression is to build unique characters whose strengths and weaknesses are determined through statistics, such as in actual RPGs or ARPGs which demand way less twitch reflexes in comparison to most action games. The fun in the aforementioned games is to be able to build wildly different characters, while the degree of build variation in games with upgrades tacked on is often incredibly shallow. The problem with upgrades in action-oriented games is that it takes away from skill, and said games rarely even try to strike a balance like Deus Ex or Fallout: New Vegas.
For smaller games more reliant on mechanics, tacked-on upgrades merely unbalance the game by introducing useless bloat and make the game feel less tightly designed (looking at you, Iconoclasts). Even worse if basic QoL features are locked behind upgrades. In Ys Seven, you'd have to build up SP to perform special skills by doing something called a Charge Attack, but this would take for fucking ever and require a lot of spamming Charge Attacks. But several hours into the game you'd find an upgrade which doubles the SP gain from Charge Attacks and halves the time required to charge an Charge Attack. Why wasn't this a feature from the beginning? This is your mind on tacked-on upgrades.
Are there any other games you have in mind which you feel don't make good use of their upgrade systems at all? And what are some games which aren't really RPGs or ARPGs or RPG hybrids, but do make good use of it? For example, in games like DMC and Bayonetta certain moves are locked in the shop and need to be purchased first before using it. Here it's not a huge deal, because beginners will be overwhelmed by the already giant moveset these games tend to have from the start, and the moves locked in the store tend to have an unorthodox input to perform them which people may never discover naturally, so they're sold separately in the store with a description detailing how they're performed. Since these games are designed for multiple playthroughs on multiple difficulties, purchased moves carry over and are just an extension of your moveset rather than trying to be a different playstyle. Usually performing well in these kinds of games nets you more currency to purchase more moves, so an incentive exists too.