Every one of the tube frame models used that type of rear shock, all the way back to the RR1000.
It was put under there because they packaged a (physically) huge engine in a small frame. Probably also for weight distribution like the exhaust systems on every Buell ever.
The oddness doesn't stop there though, that shock works different than a regular setup.
the shock gets longer as the bike gets lower (i.e. goes over a bump) and shorter as the bike gets higher. Most bikes are the opposite, getting shorter as the bike lowers and longer as it raises.
Basically they took the Ironhead block, then mated modified XR750 cylinders and heads onto it.
Pretty sure production on the XR ended over 30 years ago, but people still race (and win) them alongside the new Street 750 flat trackers. Couldn't have been that bad of an engine :lol: