I think that’s exactly right. The root level script declared the script TheParent as the parent. me is the root level script and so its parent is the script object. Exactly as your result showed. it and me refers to different things.
1 good reason is to avoid AppleScript being the parent, other uses is for setting up inheritcance between objects in AppleScript which works. A third use with be to set up a collection, where the items in the collection can respond to and query the collection object.