If the streching is so small as to be unnoticable (and I agree it's pretty subtle) then I also don't really understand the benefit.

Typically, the idea behind this sort of design is that it should be unnoticeable. The motivation is that, with other monospace fonts, the differences in character width, along with the inconsistent spacing and line thicknesses are both noticable and distracting. Some of this badness is avoidable, and this is what this font attempts.

and yeah that height difference is really weird. That almost seems like a bug.

I've been informed, (and had to double check because I didn't believe it,) that the two "i"s are actually the exact same height. The first looking larger than the second is an optical illusion. Font design is hard.