This probably dates back to the '30's or '40's when not every home had a garage (or even a hot water heater or maybe no running water). If you had to drag a hose from the water heater to the car, hook it up, hook up a return hose, then turn the water on, it would likely freeze before it circulated. Doesn't take long at 30 below!
You could hook up the water when the engine was still warm and let the water run all night, but most A owners back then were either too poor or too thrifty to do that.
So likely a low budget oil cooler.