The story goes that Social Combat was directly harvested from an old 1E supplement for playing raksha - which is why it's so adversarial and weird. It was originally intended to model Chaos monsters slinging narrative mindfuck attacks at each other.
That explains a lot. And then 2E Shaping Combat made it even worse, since they'd already cribbed the more straightforward mechanics for social combat.
See, I don't think it's "lost" on players so much as the system plainly IS adversarial. A certain feeling of cynical edge and little respect for characterization kinda emanates from how things are framed. People are not stupid, and they pick up on that.
I would in fact say that the mechanics are significantly worse than not having any at all, because I have seen people who otherwise are great roleplayers who would rather spend a session discussing economics with the orc chieftain than attacking it shut down into full tactical assault mindset when Social Combat comes into play. Hell, I've seen players threaten each other with social combat the same way you'd threaten someone with running them through with your sword, and social combat was considered the worse threat.
Oh, I don't disagree that the players are picking up on what's there. That doesn't change that it's not what is MEANT to be modeled. It highlights the problem with the presentation.
I do think that it's better than having no mechanics at all, if only because it opens the door to exploring better mechanics, rather than leaving us with a list of traits you can invest resources in that
do nothing except let you ask, "Uh, is 30 bazillion enough successes to convince this guy who just saw me eating his wife's corpse for dinner that he's madly in love with me and wants to help me cook his children, too?"
The mechanics aren't
good, but they're better than nothing, because "nothing" means that your stats for social stuff do nothing. So investing in them is stupid, because you can just "RP" around having bad ones.
Yes, that's actually bad role playing, but even though you and I know that, that doesn't change that I've WATCHED that mindset cause games to have players who are good at play-acting a role dominate in social situations over players who invested their chargen resources in being a good socialite, while also being THE BEST fighter/mage/whatever because that's where they actually PUT their resources. Thus, the second player is overshadowed everywhere because he's bad at non-social stuff (having put his resources in social), and can't "play act" the social stuff as well as the other player, so the other player's character is treated as being the better socialite.
It stands out in particular with characters who are of a stereotypically socially inept/uncouth clan/race/class/status. The player revels in the reputation as "the one socially-acceptable/polite/well-spoken [whatever]." While the high rolls but poorer play-acting of the actual socialites are hand-waved as, "Well, yeah, but you're EXPECTED to be that way, so it's not as impressive."
(This is a problem I saw most often in L5R 2e and 3e, but I have witnessed it in WoD games, too.)