The seam allowance is not the important thing. The size of the patch is. Look at it this way. If you have a piece of fabric that is exactly 1.5" wide, and you sew seams exactly on the .25 and 1.25 lines, you will not wind up with a patch that is exactly 1" wide, or a seam allowance that is exactly 1/4". That is because the thread takes up some room on both sides of the seam. For some patterns this does not matter, but for many it does. (A simple example is, if you have 5 patches on one side of the seam, each supposed to be 1" finished, and 1 patch on the other side, cut at 5" finished, then they will not match up if each of the 1" patches is actually 4.95".)
It would be impossible for pattern designers to write patterns that would make up for the width of the thread. For one thing, thread weights and fabric weights are different. When I press a seam using BottomLine thread and a lightweight quilting fabric, it will be act differently than if I press a seam using 40 weight thread and a heavier fabric. By necessity, patterns have to be written as if the thread takes up no room in the seam.
We quilt with fabric and thread, and both are 3-dimensional. If we worked in a 2-dimensional world, then we could ignore the scant 1/4".
Here is one video on how to figure out where to set your seam allowance. There are many more if you google "scant 1/4" seam allowance".
https://www.youtube.com/watch?v=3j0wFhr8Jfk