Yes but no one wants to switch a disc for every chapter of a game. It would be like 20 discs, instead they compress it onto a blu ray. Your console decompresses it and stores the info on the hard drive.

Then buy an external hard drive or only have the games installed that you are currently playing.

You are making a mountain out of a molehill.

It's because the information on the disc is compressed. It isn't a Sony thing it is the games themselves. They are too big to just be run off of the disc.

As for space. Delete the games you aren't playing off of your hard drive. Your saves are stored separately so if you reinstall you won't lose your progress.