I don't know as much about the biological makeup of muscles as I should, so my answer is going to be based on the results I and many other fitness fanatics have had from doing workouts similar to the ones you have described.
"How can you be expected to do (exercise A) properly when you have just exhausted the
muscle group from (exercise B)?"
Simple - if you cannot correctly perform exercise A because you are exhausted, decrease the weight. It doesn't matter how much weight you use as long as you - 1. have good form 2. are pushing yourself to your desired limit.
From my personal experience, my chest days generally consist of multiple different bench press exercises, with some flys and some serratus work. By the end of the workout I have done about 5 different exercises. The reason I can still do flys properly after I have exhausted my chest from bench press is because I use the proper weight to maintain good form during the exercise.
"Why do isolation workouts after doing compound workouts?"
I don't know quite as much about this question other than what seems like common sense. The answer is really in the question. Compound workouts are great for hitting multiple different muscles but in order to increase mass and definition you have to isolate different parts of those muscles which aren't necessarily worked by the compound exercises. Bench press does not work your outer chest muscles nearly as much as isolating them with flys. Still using chest as an example, your chest will not look proportional or very good in general if you only did flat bench press. Incline bench works the top of your chest while decline works the bottom.
This is all directly relatable to other muscle groups as well and does not just apply to chest workouts.
In my opinion and I think most people would agree, bodybuilding is about appearance - vascularity, definition, symmetry, striations, mass etc. Strength training is simply about getting stronger. The two are very different so don't be surprised that BB requires isolation workouts as well as compound workouts.