You are correct - it is about mitigating risk in a situation - correct me if i am wrong, but the bands you play have 2 guitarists - 1 acoustic 1 electric, bass, drums, vocals x2 and sometimes you have wind instruments depending on which one of your bands is playing.
That is a whole wall of sound which can easily fill in for potential issues - lead guitar breaks a string, the rhythm of the song carries on with the rhythm guitar, lead singist has a coughing fit or something, second/other singer steps in.
Go down to a three piece - any one element goes down, the whole bottom falls out the songs. When i was doing hip hop multiple modalities for the backing tracks and there were 3 of us, everyone learnt everyone else’s lines for an instant drop in - its what necessary