Looks like a branding opportunity that doubles as a skirt guard. Or a way for short riders to keep their hair out of the wheel. Pragmatically, it's a good way to avoid the usual mudguard alignment problems on a bike that's not going to be properly looked after.
As for sidewinds, it's probably about the same area as a full-sized pannier. I've never noticed those being a problem, though as a heavier rider I suppose I'm less affected anyway.