You, sir, are missing the point. Of course the DM can come up with that. What he can't do is port the knowledge directly into his player's heads. Or design an NPC that specifically represents an important goal or connection to one of the characters (well, he can...). Or give them the same sense of connection and ownership they get form doing it themselves. It's not just NPCs, it's factions, politics, mysteries, anything and everything.Sure, I suppose. Per NPC that wouldn't cut much time off the construction and would potentially introduce anachronisms you'd have to be watchful for. If the campaign uses a few hundred NPCs the player sketch out, the savings might add up.
Also, it can be hard to be really creative all the time. I came up with that NPC on the fly, and I like it a lot, but if I did it six or seven times in a row it would lose a little something.
Anyway, the point isn't simply time savings up front, or even in general, although that will happen. When the players already know the faces, their role playing will be that much stronger. They will more quickly connect NPC/Faction to circumstance, or identify an NPC to go to for advice, information, or whatever. They might identify a mystery built into the setting they want to explore. Or they might decide to wade into faction politics and upset the apple cart. All things they already know about. That kind of character driven play doesn't happen as much without prior knowledge.
How many times have any of us decried the lack of player knowledge that accurately matches what the character would have? This is one solution.