This is how Google managed to avoid having the entire domain made illegal in some countries, most importantly Germany, due to wantonly hosting illegal content: shard into per-country domains, ban the per-country illegal content on their domain, and shrug regarding the other domains.
The particular issue was that Germany, for historical reasons, has restrictions about what one can say about Naziism which are not compatible with American notions of free speech.
GeoIPs aren't 100% reliable - there's a small but non-negligible chance that geolocating your IP will place you in a different country than you're actually in. When faced with the choice between accidentally censoring legitimate content that you have a right to see vs. accidentally letting you see content that is banned in your country, Google would much rather let you accidentally see the banned stuff.
But what's the benefit of adding another detection layer over the existing one? If the GeoIP is wrong, it'll still redirect me to the blocked domain. If I can change the domain and access it anyway, what's the purpose of blocking?
It doesn't make sense to me that they implemented GeoIP blocking by redirection, as it only has added downsides.
It's an escape hatch. If they block outright, then if they block outright and are wrong, a legitimate user cannot see content that they have a right to. If they use a redirect, then a user - legitimate or illegitimate - can bypass that block, but they have to explicitly take action to. Consequences are on them, then.
Remember that Google's mission is to "organize the world's information and make it uniformly accessible and useful". Their purpose is not to block the content at all - if it were up to only Google, they wouldn't have either a block or a redirection, you'd just be able to access the content. The country redirects are the result of a negotiation with the country, where Google says "Okay, if we did this, would it be acceptable" and the government says "No, too permissive" and then Google says "Okay, what if we did this?" and then finally the government says "Alright."
This annoys the hell out of me as it also never seems to correctly remember I clicked "got it" to the "we use cookies" message that sticks to the top of the page.
The particular issue was that Germany, for historical reasons, has restrictions about what one can say about Naziism which are not compatible with American notions of free speech.