They're useless because the Paladin can just heal them with lay on hands.
If you don't assume there's a large amount of Paladins or 3rd level clerics in the setting then they could certainly ravage a city. Not much threat to a PC party with a Paladin or Lesser Restoration however. How fast they spread depends on the disease.
If you want them to matter to the party take away the Paladin's abiltiy to cure it, and make it take at least Greater Restoration.
On the other hand, Paladins are also kind of the reason diseases are still even a thing mechanically. Like, I probably wouldn’t even think about making the players roll to resist catching sewer plague or whatever, but for the fact that I don’t want Paladin players to feel like all their anti-disease class features are worthless.Paladins. That's why.
Clerics also have a role in this, but it's mostly paladins.
But, if diseases aren't used by the DM because they think that they're useless because of the paladin, doesn't that also make the paladin feel like their anti-disease features are useless?On the other hand, Paladins are also kind of the reason diseases are still even a thing mechanically. Like, I probably wouldn’t even think about making the players roll to resist catching sewer plague or whatever, but for the fact that I don’t want Paladin players to feel like all their anti-disease class features are worthless.
On the other hand, Paladins are also kind of the reason diseases are still even a thing mechanically. Like, I probably wouldn’t even think about making the players roll to resist catching sewer plague or whatever, but for the fact that I don’t want Paladin players to feel like all their anti-disease class features are worthless.

(Dungeons & Dragons)
Rulebook featuring "high magic" options, including a host of new spells.