I guess the most obvious example of when this would occur is: suppose click switches to using flit for builds, and then flit switches to using click for command line parsing. Now there's a bit of a chicken and egg problem where 'pip install click' will end up importing flit with the click source tree on the path, and this tree of course contains a directory named 'click', so unless special measures are taken flit will end up importing the code it's trying to build.
But of course this can happen for lots of reasons; most packages have names that you wouldn't expect to randomly encounter at the root of a source tree very often, but with 100,000+ packages on pypi I expect it will happen eventually.
This doesn't happen with setuptools because setuptools traditionally has few or no dependencies, but obviously we're changing that; the whole idea here is that now your build system has full access to pypi.