Every tool has a boundary, and knowing yours is more useful than pretending you do not have one. Here is where a LiDAR room scan is the wrong choice.
When the tolerance is tighter than an inch
Cabinet shop drawings, countertop templates, stair treads, replacement window units, millwork fit-up. Phone LiDAR delivers roughly an inch at room scale, which is excellent for pricing and useless for fabrication. Scan to bid it, measure to build it.
When you need one number right now
You are standing in a hallway and you need the width. Use a laser measurer. It is two seconds and no app. Scanning is for capturing a space, not for answering a single question.
When it is a legal boundary
Property lines, easements, setbacks, encroachment. That is a licensed surveyor's work with a surveyor's instrument and a surveyor's stamp. A lot trace gives you an area for a bid, not a boundary for a filing.
When the geometry defeats the sensor
Open double-height voids, tall gable peaks, roof planes from the ground, long exterior runs, bright direct sunlight on an outdoor scan. These are range and optics limits, not technique problems. The upper reaches of a building are better handled from the plan dimensions and roof pitch.
When the space has no walls
Truss-framed attics, crawlspaces, open warehouse volumes. You can capture them for documentation and footprint, but a parametric room model needs a room.
When nobody will use it
If the deliverable is a one-line price on a small repair, the scan is overhead. A ten-minute drywall patch does not need a model.
What is left
Which is almost everything else — whole-house as-builts, bids on area and perimeter work, documentation, client presentation, remote estimating. The boundary is narrow, but it is real.
A tool you know the limits of is a tool you can rely on.