If you have a file/directory that will be needed at many different places and don't want to copy it <n> times everywhere in your filesystems, you simply use a soft link to reference to the original file.
Depending which type of filesystem you use and if it is not for thousands or hundred of thousands of files/directories, I would rather not speak of a waste of i-nodes.
We save disk space with them and enhance the administrative complexity a lot.
A soft link allows you to put nearly any text into it, not necessarily paths and files. So why take the extra effort to check and disallow a self reference? You'll hit a brick wall anyhow sooner or later: