Yeah, great, rather than just going to the .foo directory for the foo program to find user specific state for that program I have to first figure out where the particular distribution likes to put things by default and then hunt through something like 5 different hierarchies for the foo directory.

The "old" way forced program developers to put things in a very specific place. The new way allows then to interpret the XDG standard however they want and scatter everything all over the place.