I think the issue is that games are games; an example that springs to mind is Caves of Qud’s Markov-chain generated books. I don’t mind them, but once I realized what they were, I stopped reading them. Unless it’s written by a developer, it doesn’t matter. They might as well be empty, unopenable items, like books from Dwarf Fortress where they get a description of what is inside but not any text from the passage.
Even random dialogue is interesting in games not only to “immerse” the player, but to receive messages and information from the developers; if they are randomly generated, they have no purpose. The game would only be improved by their absence.
Basically the upper management was getting mad that Paper Mario was taking on too much of its own identity compared to the broader Mario brand. It’s why Origami King is mostly just Toads all over the place.