That's true. I suppose it's a trade off between protection against lost vs. smaller attack surface.

> Since there's no master key, one has to only compromise the OS to get at everything

That's wrong, compromising one device doesn't give an attacker anything useful. Only if two or more devices have been compromised can passwords be decrypted. But in any case, I think if your device is compromised you might be in bigger troubles anyway. E.g. if an attacker controls your device, ransomeware might be easier and more lucrative to them than going after more devices to hunt for passwords.