When and why should the Strategy Pattern be used?

The problem with toy examples such as this is that it is often easy to miss the point. In this case, the code could indeed be just implemented as you have shown. In a strategy pattern, the main value is in being able to switch out different implementations for different situations.

The example you have is only illustrating the objects in the pattern and the interactions between them. Imagine instead that you had a component that renders graphs for a website depending on whether it was a desktop or a smartphone on the other end you would have some code that would detect the type of browser the create and set the strategy on another component that could use the strategy object in some complex code that would not need to be duplicated and would do the work in both situations leaving the details of the actual drawing of the graph to the appropriate strategy object:

interface GraphStrategy {
    Image renderGraph(Data graphData);
}

class BigGraphStrategy implements GraphStrategy {
    ...
}

class SmallGraphStrategy implements GraphStrategy {
    ...
}

Then in some other code:

GraphStrategy graphStrategy;

if (phoneBrowser == true) { 
    graphStrategy = new SmallGraphStrategy();
} else {
    graphStrategy = new BigGraphStrategy();
}

The rest of your application code can then just use graphStrategy.renderGraph() without having to know whether full or small image rendering is being performed.