Simple guess: Their DNS server always returns the same IP address, which is a simple transparent proxy. An encrypted VPN would protects you from data sniffing

Simple guess: Their DNS server always returns the same IP address, which is a simple transparent proxy. An encrypted VPN would protects you from data sniffing done by your ISP. Obviously the VPN provider will be in a position to sniff your data. With the transparent proxy, your data is not encrypted and can be sniffed by both your ISP and your "VPN" provider.