DISCLAIMER: Very very long post ahead. If you don't like to please move on to another post and don't waste your time on this one. Else please start and keep reading until the end.
There are several different ways time mechanics are used in games. Passage of time is one thing, artificially speeding up or slowing down the flow of time, playing real-time where 1 sec. == 1 sec. or based on a formula like 24 hrs./x == x mins. real time.
You mention lack of balance, which is true in some cases, while in general you will find time mechanics balance out something else, for instance the level of difficulty. Watch this short
Prince of Persia video and you will see how it helps fighting enemies, keep making progress without dying unless and until your Sand of Time is running out &etc. Most of the time you are running around in real time, you might not even need to slowdown time, like sliding down that banner jumping on the mast and on to this wooden bridge, though you'd have to be very good to pull it off.
Another way to balance things out or making use of time mechanics is change of age at a certain rate based on a time formula. 1 year == 30 min. in game for instance, or 8 hrs. == 8 min. where you start getting hungry or thirsty or both. Either you eat or you suffer some artificial deduction of strength, stamina, speed, ability to run or even walk. In survival type games you may as well drop unconscious, being attacked by something while you're out, ending up dead. Stardew Valley and the like dropping and ending up in a hospital or your own bed is the most that can happen.
A very interesting way time is used was in Darklands. You will age, based on some formula, you can start off as baby and end up 80. When time passes you grow strong, gain wisdom and knowledge, all tasks are easy, you are able to carry heavy things around not including your clothes, armor, weapon(s), you can run for miles without so much as getting tired. Though once you will grow older your abilities start deteriorating and what once was easy could then become impossible. It conveys the
feeling of passage of time as well as effects of time on your health, mental abilities and your body. You can't speed up time or reverse it (not that I remember that that's possible like it would in games like Might&Magic where it's possible to 'reset' your age.)
Then there are games like GTA or maybe Mafia and several ways time is used. In GTA you get the choice to travel on foot, car, ... from point A->B. You also get the choice to click on your map to get to where you want in a matter of seconds. They allow you to explore yet mind your time not forcing you to always travel to a place you've been to hundreds of times by whatever means. It is on you then to decide to use it or explore alternative routes to get from A->B in real time. Once you have seen most everything you will certainly appreciate the open to artificially travel in a very short amount of time versus 10 or 20 or 50 minutes because no matter how good a game looks it will get boring.
It is very much the same in adventure type games. Do you really appreciate a game where you have to walk slowly to an exit point to get to the next screen? Or having to walk through the same screen three times because you have to backtrack to find some item or solve some riddle? This isn't fun and another very good use of time to make it fun instead of a bother to keep playing. Keeping you walking only just stretches time artificially and for no good reason ...
In Per Aspera you get the option to play in real time, building or bots moving around, the overall passage of time in game, are x-times faster even at 1x speed and can be sped up by a factor of up to 16x. At the beginning you will enjoy playing at 1x speed but soon find to get you anywhere you would wish to speed the process up to finish buildings or having them torn down. In addition it is possible to prioritize building or tearing down buildings speeding the whole process up even more. Great use of time!
Loop Hero uses passage of time in several different ways and on several levels. Time spent in game is measured in real time, a loop can take longer or be shorter depending on its length, so when a short loop takes a little amount of time the enemies will grow stronger, while you on the other hand might still be some levels below in terms of weapon and armor or the ability to summon a greater number of strong skeletons, making it harder for you to progress quickly and sometimes impossible to beat a boss in a run because it has taken you 18, 19 or 20 loops to get to it. The boss will be incredibly overpowered by then and kill you in a matter of seconds.
On the other hand you may have a very long loop and speeding up progress and time can have you face a boss in no time. This, then, may lead to another problem, where you might be able to beat the boss but can't, because again you lack weapon(s) and armor protecting you and allowing you to do some serious damage. Waste time and fail, place to many cards spawning enemies, or additional/special enemies from normal cards, or additional monsters with monster-support-cards, some of which will protect your enemies, granting them additional abilities or stats, fail. So you have to make as good use of passage of time as you can to make your run a success.
Then you can speed up your character and speed of time by placing support-cards like towers. You will find items granting you a +% to up your attack speed, you will have cards accelerating the passage of time during a loop, which will both help and hinder your progress. A new day both heals a certain amount of damage while at the same time monsters will spawn. I could go on and on how brilliantly developers implemented time mechanics in Loop Hero and how well balanced it all is ... Suffice to say the most important time is amount you spend playing it which for me amounted to +500 hrs. and that's probably on the very low end.
Some games might make use of time mechanics, let's say Terraria, in which you can do lots of things and make progress in a short amount of time. On the other hand it is up to you what you do with your time and its passage. It is totally possible to spend 1000 hours doing nothing but digging tunnels and not building a single house. Leaving you with nothing to show for your time. Passage of time in game at whatever speed doesn't matter then.
Pathfinder or PoE will put you into a situation where its game mechanics and speed of passage of time will put you into a situation where you don't have the luxury of wasting time. You will have to make progress, you will have to be in a certain place (POE) with a certain number of NPC in your party, else you can't take on a side-quest. In Kingmaker you might fail solving a quest. Very much the same in Sea of Thieves, you either make it and finish a deed or fail and you wasted time trying. In all those cases you can try again, which means loading a save game, or go back to an NPC and collect the same quest again (SoT). Not really anything to do with time mechanics in a game just saying.
There is Order of Battle where time is measured in turns. It is more like a chess type game where once you find out what troops to use you could finish it in < 15 turns taking you a certain amount of time versus 30 moves. Sometimes you get a set of main- and side missions and you have to decide how to spend your time. Will you try to solve all missions and eventually risk failing, because 'time' has run out, or will you try because there's rewards helping you later on? This is both a question of time as well as taking time to figure out how to solve all missions and reap the rewards. Since it is possible you either take the time and try or don't and just keep progressing through a set of scenarios.
Imagine playing a game like Hearts of Iron in real time where 1 min. == 1 min. == 1 min. Imagine playing the whole war as Allies/Axis, slowly building up your forces, finishing building a panzer or diver bomber, a submarine or ship, doing diplomacy where you will not get the answer in a second but in weeks or months. Thanks to a mod it is possible. Would it be worth your time to change the time mechanic to do it? Same question for other games like Gary Grigsby's games or any other war game at all really. Your time your choice.
One final example where real time is part of the game is a game called The Longing. You play for 400 days (or don't). Once you start it time keeps ticking down and you can check back on it 400 days later or you play and slowly explore, collect things and solve puzzles, it is up to you.
In almost all games with time mechanics there is also a balance in place, and then there are others wasting your time with time mechanics as you say, making it feel artificial and not at all fun to play. For me the game I hated most for a time-limited mission was Sherlock Holmes and the Case of the Silver Earring. While most of it is point&click, all very relaxed, there is one point where you got to get through a labyrinth, a timed mission, you failing means game over. The worst kind of time-mechanic in a game like this. There is an old who-dun-it game where you have to be at certain places at certain times, everything you do you got to measure time, you must memorize the whole game basically and what to do where when and how long it takes, otherwise you fail or miss a person. That's again one of the worst way of using a time mechanic.
So whether a game makes good use of your time and time mechanics and which is worth your time playing and finishing should be rather easy. I could go on and on because this is such a fascinating topic with lots of very good and very bad examples but i will leave it at that as it is already to long of a post which I don't suspect many will read. If you do more power to you! ;-)