It just melts easier without separating. If you melt straight cheddar, you end up with a fuckton of oil floating on top and it's generally not very good as a sauce by itself. Singles are basically just a cheese bechamel sauce that can solidify for shelf stability
What I find funny about this "it's plastic!" claim* is that it's... arguably correct. Except that by that definition every single type of cheese would be a plastic.
At the end of the day, a "plastic" is any synthetic material that is made from a polymer, that you can shape or mould into an object. And while casein (main component of cheese) might be quite complex, as proteins typically are, when it comes to cheesemaking you can simply see it as a proline polymer with some junk added it.
*or a similar claim that I see often in Brazil, regarding a local cheese (queijo prato) being plastic too.
Yup, it does have multiple meanings. That's why I said "arguably".
When people say "it's plastic!", they're usually conveying that it's made from inedible stuff, I'm aware that they don't mean "it's made from a polymerised substance that has been moulded while it still had some plasticity".
It's a bit of off-topic but your comment made me realise that it's theoretically possible to create cheese out of petroleum, air, and salt. It would be expensive and awful-tasting, but probably edible?
I might do the synthesis route of that just for fun.
It might no even taste awful. Petroleum has a lot of interesting compounds that you could probably convert into flavor molecules if you could isolate them. This isn't an endorsement of the practice, but chemistry is pretty cool.