The Zenfones mainly carved out a following because they're the smallest flagship-tier Android phones on the market. Asus has terrible support, but if you want a small-ish device there isn't a great deal of choice nowadays.
For some people, the ability to use wired headphones/earphones while charging has a lot of value. Additionally, some invest in quality earphones or IEM's and replacing those with the lower-quality limited selection of USB-C earphones is not desirable. Likewise with Bluetooth.
The 3.5mm audio connection is nowhere near dead yet.
FWIW for IEMs with detachable cables, which pretty much all of the good ones do, you can get replacement USB-C cables now. That has the advantage of decoupling the sound quality from the highly variable quality of the phones internal DAC since the DAC is instead part of the cable, and some of those cables even have configurable hardware DSP features. It doesn't solve the charging problem though.
Indeed, today if you want a phone that isn't gigantic the options are really limited. Zenfone also had benefit of being quite sturdy since the back wasn't made from glass/metal, so you can go without a protective case. I have dropped mine a couple of times, but it hasn't suffered any damage until now.