I have transacted a number of homes and land parcels, so while I am no insider to the real-estate biz I mostly understand the entities and relationships that exist at least in the non commercial space.
I can't understand why sellers would want this in the general case. Typically when you list a home or property you generally want to sell it as fast as possible. Narrow exception being you have not yet identified a new primary residence, even then most sellers will need the equity or be looking at bridge loan so you'd still be wanting to get the current listing under contract so you can understand what the cost and life time of the bridge loan are likely to be. Otherwise you are looking to get out because the long you own after you decide you no longer want to do, you're just being eaten by carry costs: fire insurance, liability (if it just a parcel), utilities, taxes, and maintenance. In summary you want to solicit the largest number of competing offers from the biggest pool potential buyers as quickly as possible.
You are already paying your seller's agent commission, they are supposed to be working for YOU, in what world again under the general case is hiding your listing from potential buyers even if only for a short time good for you?
Now imagine you are buyer, again you'll be paying commission, the agent should be working for you, in what world are better served if chose to limit the potential listings to match your with vs the whole of the market. Zilow is easy, if I was buying I'd scroll thru the listings on my phone and for sure if I saw something that looked good the agent hadn't matched me with I'd be ask why, and I'd want a decent explanation how come they did not include it..
I do realize there are unique properties which might you might want to market more selectively. A land parcel for example that is a good location but will require significant title and easement work before its accessible/buildable/farmable/whatever; sure you might shop that to only sophisticated buyers who understand the details, costs, and risks there because otherwise you're going to get a bunch of offers on paper with standard contingencies, that have you going - dude it is right here in the listing there is a utilities easement but the local power company will need their name added as user or have the easement made public; so already we don't have a contract can you read? You need a buyer who gets that they are going to have to probably bribe^H^H^H^H^H compensate the neighbors to add name to easement because they might figure it is nicer if nobody builds anything there, on the other hand they might consider the improvement to the value of their own property should the question of getting power if desired be removed, but someone has to do the organizing work of getting all the parties to act.
Similarly buildings that are 'historic' and such again you might want to qualify the buyers.