Do other companies do this? Is it considered Agile? Can it show real insight?
No. No. No.
Why not? Because it's completely pointless. You said you have sprints. I guess they have tickets or stories in them. So you already have an objective measurement how you did. 8 of 10 stories done? 95 of 98 story points finished? There you go. Objective measurement. Getting told by management that your performance felt like a "7" this sprint? What is that supposed to mean?
Feedback is important, but since you tagged this retrospective: yes, a retrospective is the way to go. If there are problems or issues, they need to be brought to the table. By anybody who can bring them up, maybe that's a management person. An issue can be discussed, understood and something actionable can be planned to improve. Getting told your sprint was a "7" is in no way actionable. There is no path to "8" other than "better luck next time".
So no, getting rated a number is in no way helpful. It's a process for processes sake, the opposite of open communication, respect and teamwork.
Just out of curiosity, do you get to rate management as well? Ah, forget it, we all know the answer.