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It's not even really a privacy perspective or a technology thing. I mean that matters but that's a deeper issue.
I simply don't like the idea of an critical travel document not being physical. I like that right now I can lose my phone and I can still easily cross back into my home country. Mabey I'm just old (I'm in my 20's).
A phone is also a physical object. Yes, you could lose it, but you could also lose your paper passport.
The bigger issue in terms of reliability is having your documentation on a device with a battery that can run out.
What if you have your phone and lose your physical passport.
Either way you're screwed.
To your second question, have you never flown in an airplane in the US since 9/11? You go through TSA at every airport, regardless of your destination. You have to show an ID at TSA. You don’t have to show a passport to fly domestically obviously, but you can. Case in point, I have a passport but I don’t have a license or other state issued ID. I will now be able to fly domestically without having my physical passport on me.
Checkpoints between states? Just think critically about this for a second.
The point of not handing over your phone is also true. There is no world in witch I am voluntarily giving anyone my unlocked phone.