One unique advantage of this design is that you could use it in principle whereever you have a plus and a minus key without changing hard- or software.
Just add 3-4 wires, hot glue the Encoder to the case or drill a hole if you dare and you have ergonomized your old piece of sh^W equipment.
Contact bouncing should be no problem, as the original keys have to be debounced somehow. Only problem could be the speed, as often even manual human inputs are too fast for the debouncing electronic.
Everybody knows the - attention, german term - "Mäusekino" of the 80ies and 90ies: Tiny displays (like "cinema for mice" which is the meaning of the term), but above all tiny clicky buttons on everything, no more potentiometers for turning. Be it car radios, car air condition, lab/measuring equipment, Hifi-stuff. Absolutely everything needed 20 to 100 pushes on the same key to get from one end of the scale to the other.
HP for example added one single rotary encoder on the devices above some thousand bucks, but in cars even mid 2000 years there were air conditions with keys, where you have to push an absurd 32 times to get from 16 to 32 degrees C and vice versa, or 10 steps for the fan from low to high.
I am sure all manufacturers of that unergonomic stuff knew about this kind of encoder. And they knew that they would never be allowed to spend 6 Euros each. So millions of people had and still have to push billions and trillions of dome and rubber buttons everyday in staccato, instead of comfortably turning a knob.
Luckily at least the aviation industry spent more money, so the autopilots still work on turning knobs as in analog times. So the pilots save at least 15 minutes per flight of button-pressing like mad.