They offer the distinct advantage of not rounding the cutting edge (assuming you use them properly). Using a belt sander for sharpening tools has its drawbacks. Beause belts don't run exactly tight and flat, they tend to roll ever so slightly right at the point of contact with the item being sanded.. That has the effect of reducing the desired clearance angle, or slightly rounding the relief at the cutting edge, making the tool not cut as easily. I do not recommend a belt for sharpening cutters, even though I, too, use one occasionally. They cut cooler by a long shot, but not as well as a wheel where the ground form is concerned. .
That's in reference to brazed carbide (lathe) tools, something I used to use in quantity, and still do when I run my lathe, and even my mill, when using a fly cutter. As the carbide is sharpened, the amount of overhand it has with the steel shank goes away, so you have to grind away more of the steel to avoid touching the diamond wheel with the shank. Clear?
You likely have NOT seen what I'm discussing. The vast majority of the diamond wheels you'll find in places like HF have a metallic matrix. Wheels like that are great for certain applications, but not to good for sharpening carbide. Resinoid bonded wheels have a general dark brown appearance, and the diamond is contained within the brown area. It varies in thickness, but the type I use has a 1/8" thick matrix/diamond layer.
H