I think there are still some readers for whom the paperback gives the appearance of legitimacy. Lots of readers still love paper, though I find many of them aren't that eager to try self-published titles yet.
Paperbacks also make nice gifts and contest prizes. They can also be good visual advertising. Friends of John Smith, who won a paperback in a contest, may not know what's on his Kindle, but they can see what's in his bookcase. I've also been known to read one of my own books in public, like while I'm waiting for my car to be serviced. People don't generally ask me what I'm reading, but some of them do look at the cover. The same people wouldn't look over my shoulder to see what I was reading on my Kindle.
I have paperbacks for both my KU titles and my wide ones. It's true that KU readers are probably not interested in paperbacks most of the time, but paperbacks give one an opportunity to reach a wider audience. A significant number of people still order paperbacks from Barnes and Noble, for example.
I can format a paperback decently in a couple of days myself, but I invested in Vellum. It's a one-time cost, but spread out over all the paperbacks I'm like to do in my lifetime, it's not that much per book.
It's true that some cover designers sell each cover type ala carte, but the ones I've dealt with include the paperback cover in the standard price.
I don't worry about bookstores. I can always order author copies if I find a place that takes consignment. Most indie authors have a tough time getting books into bookstores any other way, and nice as it would be, I'd rather chase possible dreams than almost impossible ones.