Fatbike tires yield at most the equivalent of about 3" of suspension travel. But it's different than mechanical suspension. Fat tires are a lot bouncier than mechanical suspension (imagine riding on basketballs), but on the other hand they're responsive to a whole spectrum of shocks and vibrations that mechanical suspension is no good at.
Fat tires dramatically increase available traction, but they also increase rolling resistance versus narrower tires inflated to much higher pressure. Fat tires allow riding on surfaces that are otherwise too soft to roll over (like sand and snow), and they help reduce damage to trails, turf, and other unpaved areas.
Fat tires don't do quite the same job as mechanical suspension, but they are a viable alternative whose side benefits include simplicity, reliability, stronger wheels, and usually less weight than pivoted and hydraulically damped suspension. They're easier to tune for different conditions, just by changing their inflation pressure.
Generally speaking, mechanical suspension is superior for attenuating large bumps and smoothing transitions in the surface level, but soft tires are better at masking the texture of the riding surface and making small obstacles disappear.