It's fine for prototype at a very early stage, absolutely not fine for something you ship to a user.
Am assuming here that they're adopting strategies to minimize/work around the problems you mention.
It's more common in the pre-built devices to have a controller that's using a main CPU plus a FPGA or CPLD. The better hobbyist drivers use things like a beaglebone black and it's onboard "PRU" that can drive real time from memory it shares with the ARM cpu and Linux.
Also, since it's pulling train data, you need more smarts or cycles than a typical MCU to pull via WiFi/https, transform text into pixmaps, etc. Though there are examples of beefy MCUs doing all this well, like an ESP32. Or examples of small MCUs driving a small single color matrix.
Edit: Yes, you could even use an ESP8266, though 32x128x3 plus X bits of PWM brightness would mean being limited to drawing from storage rather than in-memory manipulation. I'd jump right to the WROOM type devices with PSRAM.