Hi Kodiak100.
I can offer a response as it relates to my own experience. For me the use of instances mainly helps separate learner activity and course activity; as it relates to reporting as well as organizational analytics.
If you run reports on a single instance, of a single course, you will have to filter that course reporting, using the fields available in the custom report creation. However, a separate instance of that course allows you to enroll a selected demographic of learners. This may or may not be a filter available in the custom report creation.
Perhaps the most useful part of a new instance is that you can use an existing course, that may have been around a while, to assign a "new" learning event for other users,and set new expiration dates, reminders, etc. For example, if you assign a course to a group of learners in March, and then the same course to a group in October, using a new instance avoids duplicating the same course, yet allows separate timelines, notifications, and reporting on the same, re purposed content.
Additionally, a separate instance allows you to establish different learner groups, badges, and alerts.

It all depends on how your organization will be using Prime.