I don't think I've ever received such a message, and I'm surprised Apple bothers to support such a thing. What in the world is the use case? That sounds extremely user-hostile, and if it were me I would throw it out. Especially once I realized my app needed special security just to handle this bonkers SMS type.
I'm just a layman guessing, but I'm thinking Amber alerts and Flash Flood warnings... or the Hawaiian nuclear strike
They are entirely separate from SMS, you are correct. WEA messages are sent inside System Information Blocks (SIB12 specifically). Other SIB blocks are how your phone learns of authorization to use the tower, what frequency channels to use, neighbors of the tower, and other control related info.
This message type literally has only one use on modern phones: to allow police to trace your location.
But boy, imagine the argument that'd get started if Apple decided to let you turn acknowledgements for SMS-Type0 off... (really, I imagine police would just lean on carriers to refuse to activate devices that have this capability, citing "network incompatibility.")
At some point my bank stopped sending these (I don't know why) and it was worse for a while.
Now, with the automatic code extractions into clipboard things are again as they should be because I don't need to care about this at all anymore (90% of the time, as most clipboard features in iOS/macOS this one is flaky too)
Alerting. The system used for amber alerts and similar is US-specific, while the SMS stack works worldwide on every carrier and mobile phone.
