[jeffmk]

I'm also curious how this is more effective at stopping a keylogger than copy/pasting from a password manager, or auto-logging in via one.

Unless it's common for keyloggers to monitor the clipboard?

In which case, for the system they've developed to seemingly work as intended, you'll have to either have a memorizable password (likely relatively insecure), or have your password written down at hand.

I'm skeptical that this nonstandard, hostile UX was designed with any sort of valid threat analysis rather some kind of Rube Goldberg-esque security-through-obscurity scheme that "sounded good" during some meeting.