If applications can't write to the Application Data folder then what's the point of an application data folder?
> Why is this even possible?
Well they said "on execution" so that's what made it possible. Now if it could install to that location without being explicitly executed (say on download or via a browser bug) then THAT would be a much bigger deal.
It's not so much the "applications can write data to application data" as it is "application data is executable by default". It's simply a design choice from before security was important. Nobody would defend that design today and Microsoft recognized this when they created appx which separates installers, executable programs, and data into separate content types treated with separate security policy.
> Why is this even possible?
Well they said "on execution" so that's what made it possible. Now if it could install to that location without being explicitly executed (say on download or via a browser bug) then THAT would be a much bigger deal.