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Isn't this actually improving safety by openly admitting how things always were in practice?

Any e2e encryption provided by the same entity who fully controls both the blackbox clients, and the server in between, is just a security theatre that they can selectively bypass anytime with very little risk of detection. Not really much better than simple client to server encryption.

Truly safe e2e requires open source client provided by a trusted entity who is as much as possible independent from the one who provides the untrusted transport layer. Eg how pgp email works.

This happened to my girlfriend and me twice on Messenger. On two consecutive nights, we heard a male voice with an American accent speaking as if he were talking to someone else, almost like they were conducting some kind of operation. It seemed as though he suddenly realized that we could hear him, after which the voice abruptly disappeared. The following night, it happened again, but this time the voice sounded like that of an African American woman. The situation was similar to the previous night. From that night, we have not used it to communicate and used Signal instead.
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one thing to consider is how just the optics of major players using e2e was an overall benefit.

people who otherwise would have gone their entire lives without ever hearing about encryption were exposed to the term and the marketing convinced them that encryption and privacy was a valuable thing, even if they didnt fully understand the mechanisms or why e2e might not necessarily be very effective in specific circumstances.

later, when presented between option a and option b, where one has encryption and the other doesnt, they are more likely to choose the one with it ("well, if instagram and facebook use it and say it is good...")

And Big Brother realized this optics was a mistake.
If someone's given the choice between say Instagram and IRC, and chooses Instagram because they heard it has E2EE, that's a loss.
perfect is the enemy of good, etc etc.

between signal and plain text, it is easier to convince friends to use signal if they see positive marketing about encryption on other popular apps they use. it is easier to convince them to encrypt their backups before uploading them to their google drive. hell, its just a good conversation starter to introduce encryption/online privacy to people that never really think about it. that type of thing.

those same friends are not going to use irc regardless. not really a loss if it was never even on the table.

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It's all about trust at the end of the day. And given that it was exposed that Apple, Microsoft, Meta, Google etc all collaborated with the US government to provide surveillance (PRISM) by Edward Snowden, how we can trust them ever again?
E2E encryption lets Meta turn down government subpoenas because they can say they truly don't have access to the unencrypted data.

I can't say I really mind this change by Meta that much overall though. Anyone who's serious about privacy probably knew better than to pick "Instagram chat" as their secure channel. And on the other hand having the chats available helps protect minors.