Installing WP in sub-folder

I have seen some instances where people install WP in some sub-folder (for e.g. wp or wordpress). They then place the index.php & .htaccess file in the root folder and modify the blog and install URL’s.

I wanted to know that is there any specific advantage of doing this as compared to installing WP in the root folder directly?

Also, is this method compatible for WP Multi-site?