The reason for using raw/block devices back then (or Veritas VxFS that created additional raw devices to access VxFS files in a manner that bypassed regular OS

The reason for using raw/block devices back then (or Veritas VxFS that created additional raw devices to access VxFS files in a manner that bypassed regular OS filesystem I/O codepath & restrictions for reads & writes) was concurrent I/O. In a busy database there are lots of processes reading a datafile and multiple processes writing (like DBWR checkpointing dirty blocks from buffer cache, but also some others), so this caused unnecessary file level contention in the OS kernel. Note that Oracle has I/O concurrency control built in, you can't have two processes accidentally writing the same block to the storage at the same time or a reader reading a "torn block" due to an ongoing write (the serialization happens at buffer lock/pin level in Oracle code). So you wanted to have concurrent I/O and you either had to use raw devices or Veritas VxFS back then. Later on concurrent I/O became available for some other filesystems too, like Solaris UFS having the "cio" mount option, etc.