On modern powerboats and warships,this is called a ' wave piercing bow'. Handy.
On sailboats, there really is no function. Yes the waterline is longer, but then why not run the deck to the same length? Doing this allows the forestay to be farther forward, giving a bigger J measurement and more sail area.
The VOR65 was not designed to a rule, so there is no 'rule bending' going on. If Farr wanted the bow to be vertical, they could have drawn the deck 6 inches longer with no effect on the boat.
Under ORR or IRC, the ratings rule factors LOA (length over all), LOD (length on deck), LWL (load waterline length) and LOH (length of hull) to eliminate any rule bending. In the absence of being able to do this, all modern raceboats have vertical bowstems.