See, in fanfiction as literature, it's pretty much wholly accepted that a character's role in a story can exclusively be... Being That Character in this AU. Which isn't a bad thing. It's just a thing. It's very often fun.
Audience familiarity with (and affection for) the characters and their relationships to one another can be one of fanfiction's strengths re: storytelling. You can play with a lot of reader expectations this way.
Anyway, if I was reading a Coffee Shop AU Star Wars Reylo fanfiction (you could basically use this example fic to ward me personally off like garlic against a vampire, tbh, but let's pretend)... even if Finn had nothing to do as a character in this story besides be Rey's coworker at the coffee shop, I would be even more suspicious and dismayed if Finn was completely missing. We EXPECT to see at least briefly all of the major members of a cast in an AU fanfic of certain length, barring unusual circumstances.
Even if he is almost completely irrelevant to the meet-cute at hand, I WANT to know where Chewbacca is in this AU! I want to enjoy a little chuckle when, idk, C-3PO is turned into a high-strung, middle-aged office guy with either a short, non-English-speaking husband or a Border Collie-Corgi mix dog named Artoo that runs his entire life. It's delightful to see the characters I know and love in the background!
But when you file the serial numbers off of AU fanfiction, a character's role in a story can no longer be Being That Character. Now, you potentially have a bunch of story elements that conflict slightly or conflict very seriously. Now, you may have additional characters whose presence is no longer perfectly explained by the fact that you are expected to include all the Avengers in your MCU fanfic.
Now, Not-Chewbacca's quirks cannot be explained away by him Being Chewbacca. And suddenly, readers are like, "Hey, kind of weird throwaway detail for Not-Kylo's dad to be a former drug runner who lives in a van with an old, foreign war vet! Is that going to be relevant later???" Once you cut the fanfiction strings, your new story may feel riddled with inconsistencies and missed opportunities. Why are these characters here if they're 1) not contributing to the plot, 2) not contributing to character ans relationship development, and 3) not even really contributing tonally (humor, angst, fluff) to the story?
I'm sticking to talking about friendships and background characters here, because it's what I've been thinking about lately, though you could obviously go on forever taking about all the many nuances of what filing the serial numbers off does to a story and the art of adaptation. I just had a "Oh! It's NAT! Hi, Black Widow! Sorry this story made you kind of boring, Nat!" moment recently.
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