What's the purpose of COM+ library applications?
See the question and my original answer on StackOverflowThe main purpose is to benefit from COM+ application contexts.
CoGetObjectContext for IObjectContext or IObjectContextActivity will return E_NOTINTERFACE from pure in-process component, while it will successfully work in a COM+ library application (and a server application of course).
The security context is also available through CoGetCallContext for ISecurityCallContext.
It has nothing to do with performance or isolation.
As a site note, one way to check what's available to COM+ library applications is to run dcomcnfg.exe navigate to Component Services, Computers, My Computer, COM+ application, create a new library application and check what's still enabled (as opposed to a server application).