[anatoly]

Because there is a difference. Sure, academically, and positing an ability to break into anything, encrypting the passwords and retaining the key is useless. But realistically, I can think of a few ways off the top of my head where the difference might matter.

For example, you could have a dedicated decryption server holding the server-side key, carefully isolated from the rest of the internal network, its only channel of communication a single socket with request/response on decrypting passwords for password recovery. It could have rate limiting built in, and a storm of alerts to go off if backends request too many decryptions.