For folklorists, the significance of this story is that it is a clear example of a variant of a folktale type that appears in an ancient Egyptian source as well as in many other sources including the folktales of the Brothers Grimm. This is used as an example of the widespread and enduring nature of tale types.

It is always difficult to use oral tradition to cast light on society or culture, and that sort of analysis tends to be subjective and akin to literary analysis - anyone can say just about anything and it is impossible to prove assertions right or wrong. Given that, I will leave it to others to explore what the significance of the story may be for Egyptian society.