Zero-lot-line homes do not share a wall. Each building is constructed such that a wall can abut the property line. Duplexes do share a wall. The two types of building are distinct.

Rowhouses/townhomes would be homes with two opposed zero-lot-line walls, exactly the width of the property, all in a row. If a whole-block-width building had partitioning walls at roughly the same interval, that could instead be a rowhouse-like condominium.

Sharing a wall does bring in some legal issues and definitions, which do not come into play when each structure is completely independent (but abutting other structures).

The ability to build without setbacks is a major factor in urban density. The costs of maintaining a city roughly scale with the linear amount of street frontage, so not wasting that length on empty setbacks is a great way to keep city services cheaper.

It's even more complicated in Philadelphia. Most of the old row houses do share a wall, which leads to a quirk if you buy and tear down one house in a row: you can't reattach to the existing wall.

Your new house just lost several inches of width, for having to build a new exterior wall, even if it buts up right against the existing wall. (Source: a realtor friend in Philadelphia)

The whole "sharing a wall" vs. "two walls abutting" seems somewhat academic to me from a homeowner perspective. I'm not sure why it makes such a difference.

The drawback of having no setbacks is that your pedestrians have to mingle with the car traffic? The example in the article didn't make it look very desirable to me.

On your second point, I think a few different things are being conflated here. Usually setback rules require empty land between the building and the sidewalk, so they don’t serve to create any buffer between pedestrians and vehicles.

Also, some cities have streets with no setback and no sidewalk, where vehicle through traffic is generally banned. You could debate whether this is a good idea. Personally, I found having the entire street for pedestrian traffic, while occasionally stepping out of the way of a vehicle traveling at a few mph was more comfortable than walking along the sidewalk with vehicles traveling at 30 mph a short distance away.

I think you have to travel outside the US for examples in the second paragraph. I immediately thought of Shinjuku.

I think the difference is that in the case of sharing a wall with a neighbor you have a) extra noise leakage that you wouldn’t if you had that extra layer, b) shared infrastructure, which makes things a little harder if you need to make changes/have a plumbing issue/etc. Also the roof is continuous between townhomes, so when it comes time to replace that you have to negotiate with the neighbor.

If the walls are separate, I can tear down and replace my wall without opening up your house.

It occurs to me now that the article is really referring to urban areas, whereas I live in a suburban area. So maybe that’s the distinction.