If the company has a history of releasing solid, complete products or properly using Early Access for its intended purpose (BG3), or is punching above its weight and just doesn't have the money to reach the finish line (Palworld) I don't see it as intrinsically bad, as long as you as a consumer understand that there's a risk that the end result is dissapointing. On the other hand, there's Paradox, that releases supposedly complete games and advertises them as such despite clearly having the means to slow down and put them through QA before selling them in a mechanically broken state. They'll still become great games though, after 8 years of further development and 14 DLC.
Palworld and craftopia seem to be the same framework so it I'm guessing they are gonna use some of the dump truck full money they got from palworld to contine their development process.
If this were a finished Palworld, it's already more game than most AAA releases, and more stable at that. If anything, calling Palworld a beta at this point seems like they are trying to raise the bar for release quality in general.