I'm not sure why kids and parents care about them so much (can you use them to get into good highschools or something? Idk) but theres a reason the schools care about it.
No school wants to have the infamy of having naplan scores near the bottom of the state.
NAPLAN scores are also posted on that "myschools" website where parents can compare schools. I'm sure many principals are worried about having low scores and that feeds down to the teachers as well.
Parents care about it because it's a part of many parents' nature to want their kids to perform well on standardised tests, regardless of whether it matters - it's a source of bragging - "my child got in the 99th percentile for the NAPLAN test - lalala" and also because they feel a sense of pride and achievement in what they do.
Kids care about NAPLAN because their parents and teachers are forcing them to care. Seriously, kids don't give a shit about standardised testing.
I honestly don't have a problem with schools being ranked by NAPLAN scores, it's just how schools can also be ranked by other factors including VCE scores, %ge study scores above 40, average VCE study score, amount of government funding, quality of its buildings, whether its classrooms have air-con (I will never go to a school without air-con again, ever!). But you get the point, NAPLAN scores are only raw data, they mean little but are open to interpretation.
Parents are the source of all of these problems, often too ill-informed to interpret statistical data properly, they think that high NAPLAN scores = better school, but they forget to consider other facts and the truth is this is what needs to be changed, attitudes.