Mostly academia and nation states. Physical access will always be king and this provides one more avenue for adversaries to bypass encryption more easily.
No. Your wording suggests that once attackers gain physical access, all is lost. It is not true. With a passphrase based full disk encryption, if the passphrase is strong and the machine is powered off, physical access doesn't imply data access.
Attach a microphone to the device while they are not looking, decode the keys they are pressing from the sounds, figure out what keys are the password, done.
This is _trivial_ for any mildly sophisticated attacker.
