My first paddle today ...

I am not a hydrologist, but I suspect that primarily the narrower hull creates less resistance when pushed through water. Like a sharper knife. I think they call it "shape resistance". From personal experience a 16.4 inch Stellar SES takes less effort than 18.5 inch Evo and the Evo takes effort resistance than say a 24 inch kayak. I had a quick paddle in a friend's sea kayak some months ago and the effort felt really high compared to the Evo.
There is also a friction resistance that comes from the amount of wetted area that has a bearing on speed dynamics but I am a little less clear on that.

Lots of sympathy from me.

I used to paddle a very tippy K1 on the swan, 25 years ago. Could cope with chop, even the wake from the Rotto ferries.

Gave it up in my early 20s when I moved countries, developed a neuro disease that killed my balance in my 40s.

So in my 50s decided to give it a go again. Couldn't be that hard, could it? Well, as long as I could see, I could keep a beginner boat (an 8) upright. I took out a factor 3 by mistake, and swam every 200m. So dispiriting.

It took me 6 months before I was proficient in anything other than a beginner boat (proficient meaning I could cope with race conditions, lots of wash).
Regarding your question about 'why do people paddle such narrow tippy boats?'; they are faster. Also, to an extent, in some conditions they are actually more stable. 

What! How could something less stable be more stable?
When you are in confused chop, and particularly messy wash,  wide boats, particularly square-bottomed boats, get kicked all over the place. Every little wave abruptly tilts them. A narrow boat is not really affected.

The hip balance I am talking about is very slight, not a “hip flick” to make big edge shifts.