Oh, that's right... At one time, I thought this was to disable the active subscreen, then I tried it, found out what it did, and disabled InputStart instead.
SO, without changing screen dimensions, this doesn't do much, really. It restricts available space, more than increasing it; but I expect it's what people use for non-scripted cut-scenes.
I mucked with it a bit, and the only unusual effect, occurs if you offset one screen, and don't offset the screen above it. It pretends to scroll faster; a visual illusion. If you could control screen offset, you could do some wacky things with that, but you can't.
Not being able to draw there, doesn't make much sense: It must invalidate the screen coordinates. May as well leave the subscreen blank, and draw to that.
For the record, you could cheat, and write this flag to every screen in a game with a for loop; except again, you can't, because Screen Flags are read-only. :)
This is one of those things that would make sense as a DMAP Flag; although no-one uses it for entire DMAPs because of its limited usefulness.
There are however, screen flags that should be easy to set en masse, such as 'Treat as Dungeon Room' and 'Sideview', as well as others in the Room Type, View, Combos, and Enemies (the 'Always Return attribute, could be a DMAP attribute) categories.