I can see a Cypher system version of Mistborn working really well, for example. Conversely, if you have a setting where the paranormal works in specific ways, focuses are a great way to enforce that feel and get characters that fit it. There's a lot of flexibility, but it's not unlimited and it's definitely not an effect-based system. Don't create a supers game and just assume you can create any super power you want you'll want something that fits with the available focuses. So, back to the original question: where does it excel? I'd say settings that have something supernatural / paranormal going on, and where you don't "fight" the chargen system. My players and I enjoyed the games and I would run or play in it again in a second, it was just really fun.
They're not necessary though, although I found them interesting reading they're 1/2 genre guide plus 1/2 example setting in that genre. There are also expansion books for hard(ish) sci fi, horror, fairy tales (with a real swerve into using it to discuss mental illness), and fantasy. The harder part is going to be figuring out how you're going to be doing cyphers they're not strictly necessary, but they can create a lot of extra chaos which is fun in it's own way. The core generic Cypher System rulebook has great writeups on multiple genres, including the hardest part which is picking which focuses and descriptors are appropriate for each one.
There's lots of character options, minor advancements that come fairly quickly so there's always something new to play with, and cyphers give them lots of tricks to pull out in inventive ways. That being said, my experience has been that Cypher does a really good job at making it easy on the GM while still giving players sufficient toys to play with. I have only run Cypher in their published settings (Numenera and The Strange) I haven't tried to hack it for other settings.