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The definition of open source is very tightly linked to the OSI, and has a very specific set of properties. One of those properties is that non-commercial clauses are strictly against open source. Many people misuse the phrase "open source" when talking about non-commercial licensed works, but the plurality of people using it wrong doesn't make them not wrong.
Making things source-available that weren't previously is very much a good thing. I'm all for it. What's not okay is claiming that something will be or is open source and then using a non-commercial license. It's using the reputation of open source to evoke an intuitive feeling of what the license is while slipping in clauses that kneecap the benefits of open source, and the more people that do this, the more the public's understanding of open source gets muddied.
The benefits of open source are not just that you can self-host it, but that you can use it to make your own software. Releasing with a non-commercial license means that basically nobody will work on this outside of the Owlbear Rodeo team, nobody will fork it and make their own maintained version, and it will die with the company. It means there won't be nearly as much community work on plugins or a plugin system, and the software will be worse off for it.
The Owlbear Rodeo team claimed they were going to open source version 1.0.
They lied.
Don't make excuses for them.
Totally fair. I'll update the OP.
The scary part about this is that it kinda does. The more people use the term wrong, the more widely accepted the new definition will be - we see it happen with language all the time. I personally hate it, but I think it does highlight the importance of standing against it and ensuring people don't just accept the "new definition".