What’s the point of character names when it displays the account name?

Character names are displayed on leaderboards, but primarily so you can keep track of characters. If you're like myself, and have > 100 characters combined offline and online, having names allows some way to track what character is what. IE. my 1.1.7.1 character is "HAVEYOUSEENMYSHIELD" - so when I see it in the character list down the road, I go "oh, that's my shield bash character."

That's correct, yes.

Using character name instead of account name display in-game means it's much more confusing to figure out who is who in general chat, or grouping with people. Particularly for players that jump characters a lot, or don't use uniform character naming like "EHG_Kain_ShieldBash". There's certainly arguments to be made for both sides, but we decided to use account names as the representing name to make for more consistent social experiences with other players, and get to know other players.