To me, it's a great tool to show the audience:
a. the lengths the Algorithm is willing to go in order to keep the truth from the silo
b. the lengths Camille is willing to go to keep the Algorithm from initiating the safeguard
c. the way regimes can use and abuse memory to rewrite history as it's happening
It's also an interesting plot device in terms of putting everyone in a situation they're unfamiliar with and don't necessarily know how to resolve while keeping things contained within silo 18.
The mechanical folks don't know how to act around Jules, they've been given instructions from Camille who, last time they checked, helped them escape death (especially Shirley and Knox), but they also can't abide by those instructions when Jules comes to them seeking help.
Camille, who had once sympathized with Jules and was curious to know what she'd find, is now forced to suppress Jules's knowledge, as well as do things that could harm herself and her family in order to keep the silo alive. she's given impossible choice after impossible choice and she has to keep going AND do it alone at that.
Jules herself doesn't know what's true and what's false, she doesn't trust what Camille is implanting but she also doesn't trust herself, she goes to who she knows were her friends to seek advice but is turned away, she keeps coming to them regardless, keeps searching for something that will make sense until eventually she finds it.
Overall I excepted to hate the memory loss of it all because I imagined it to be a completely different scenario. knowing what it is, I am perfectly satisfied with it and honestly I don't think I would have minded it stretching longer, with a deeper exploration of Jules's mistrust of both authority (Camille) and herself. 'Who is a person if not memories' is taken to the extreme of removing all memories and I think it's a very interesting thing to play with, who is she if she can't even remember what it's like to feel love or hate or safety or fear.