The purpose of a form is not to treat the human as a computer, who will dutifully fill in each and every box just the way you want.
No, creating a form is like hosting a party for words.
Those little boxes (one per letter) are on some forms because it communicates to you that you should slow down and write clearly, because a human being is going to have to read what you wrote and type it in for you.
The large lined area on the application implies that you're supposed to write more than one sentence.
Online forms work the same way. When you use big type and big boxes, you're telling the visitor something, talking in a certain tone of voice. The local DMV site feels very different from a web2.0 company that happens to be collecting almost exactly the same data.
We're all looking for clues, clues about what you want, who you are, whether we trust you. Even in a simple form.