This greately aids consistency and deception. It helps consistency, as large arm movements are smoother and less liable to "go wrong" than short wrist movements. Thus, under pressures facing game points (at the Olympics), she would perform with far greater consistency. It also ensures a certain element of deception. If she were to always make the same movement, but changes the angle of contact just before impact, she can slice the shuttle and create unexpected angles. You could try always taking a large swing to serve long, and slicing the shuttle to occasionally serve short next time you play!
I don't think it is a cosmetic. JCL49 has discribed it. Not only Mia does it, also Susy Susanti and Fransiska Ratnasari. This is a movement a la Indonesia.