Taking control of enough area and wiping out your enemies are both ways of making sure you score highest. Federations also contribute a significant chunk to the score. All it means is that these victory conditions are a bit more nuanced instead of being quite so arbitrary. Meanwhile, it introduces a ton of other playstyles that are all valid ways of seeing the victory screen. And even better, combinations of these are quite powerful.
Plus, this is Stellaris. To me, the victory screen is nowhere near as satisfying as leading a League of Non-Aligned Empires, defeating the crisis, wiping out all organic life in the galaxy, or even completing a second ringworld. The victory screen is more a moment for me to step back see how well I did compared to everyone, ask if I have anything more I want to do in a file, and choose whether to finish the story on that save or not.
I also really enjoy being able to get a sense of different empire strengths. Maybe it's a bit unrealistic to see a pretty close estimate of different kinds of strengths for every empire I've met, but I still like it.