It would mean reddit is discarding the biggest thing that makes it different from all the other algo-driven “engagement”-fueled social platforms.
Yup. And it's a bad trade in its case - because even if it leads to more engagement, it makes it too similar to considerably larger platforms, so there's no point staying in Reddit instead of, say, Facebook.
Becoming more like the competition might make sense, if you completely blind yourself to the fact that the customers you do have are the people who don't like the competition.