Yes, pvc liner right up the chimney. It is a special liner made for that application and comes complete as a kit. No different than the old metal liners for mid efficiency furnaces, only a smaller diameter.
Why?
Because I'm tired of listening to all the noise associated with side vents at the same elevation as my ears. Its a very loud annoying form of noise pollution. You walk down a street on a nice quiet night in the winter and all you hear is the whine of exhaust blowers. It's obnoxious. In addition there is the steam which will freeze to your bricks and eventually destroy the brick.
I live in the old part of the city of Toronto where lots are small and tight and there are mutual driveways, or just a small path between houses to access the back yards. Dumb / lazy installers will run the exhaust into a mutual driveway or pathway because, yes, it is cheap and easy, but not better. In addition, side venting into a mutual driveway is in violation of the gas code, as is side venting into a tight pathway. They just either don't know, or don't care.
But you're correct, it is cheaper and easier.