Time-based release actually works well

Yes.

The FLOSS world is full of interdependencies. Gnome depends on improvements in X for newer
features. Fedora/Ubuntu depend on improvements to Gnome and to X for their new releases.

Application developers depend on Gnome and X and other libs to be improved for their
improvements. 

Everybody depends on Users who actually need binary releases from distributions.

That is, to say, that if X does not pay attention to the needs of Distros they also ignore the
needs of end users and application developers. If there are no releases done with distros are
released, then there is really no point to even having a release. Nobody can use it, nobody
will use it. 

If you do feature-releases then your timeline is going to fluctuate. Users/Application
developers/distros can not depend on you to ship a product so they can't take advantage of
improvements you offer.  Delays build up, users get irritated, developers get bored, important
improvements and bug fixes remain unavailable to most users, and development stagnates.

Coordination is key. A convoy at sea is only as fast as it's slowest ship.

Fedora is important in this regard because they are the early adopters. They get things first
and flush out problems for other distributions. Ubuntu also follows the same pattern of Fedora
with 6-8 month release times so they are helped also by these timed releases. More users mean
more testing, bugs get found quicker and ultimately they get fixed quicker.  etc etc.