I attempted this as an experiment and the result was very similar to traditional caramelized onion:
I'm not expert so it is hard for me to comment on the changes in flavour, but it seemed surprisingly stereotypical of caramelized onion to me. The texture is softer, perhaps like a putty.
One benefit of this technique is that this ...
You would first boil the onions and then most likely burn them.
1st: boiling. Caramelization needs higher temperatures than 100 Celsius but as far as there is water in the mixture, temperature won't rise. Therefore you'll get boiled onions.
2nd: burning. Once the water is gone temperature rises very fast and since caramelization takes time you get to burn ...