That means you have to navigate to the folder with all the files in it in Terminal (which is trivial for someone that knows the command line and how to drag a window’s icon there, but not so much for others), it will probably put the names in columns, you have to open the text file in something and copy its contents, and you have to remember to remove the text file when you’re done with it. Here’s a fix for the last three:
ls -1 | pbcopy
That doesn’t remove having to navigate to the correct folder. However, one advantage it does have is that you can insert a grep (or perl or whatever) in the pipeline. For example:
ls -1 | grep '^A' | pbcopy
copies all the names starting with a capital-A. Obviously that can be arbitrarily complex, limited only by your knowledge of the command line tools available.
However, for someone not familiar with the command line and Terminal, copying the files in the Finder, and then doing a Paste Special (or whatever the application you’re pasting them into calls it), seems much simpler.