We had played with this setting last year with the hopes of doing internal/Edu sharing and found that it broke so many collaborative things.
We do try to share things with our SIS/LMS with our community, however, there are times where it simply makes sense to do this with Google.
Google forms for grants/colleges, sharing with parents, other outside organizations we work with, etc.
I couldn't seem to make a exhaustive allow list of domains. There were simply too many people that were using "Gmail.com" addresses for me to have this make sense.