On an 80186+, you'd get a #UD, but the 8086 doesn't have strictly "undefined" opcodes; everything does something.
(And yes, I'm still waiting with bated breath to see the teardown of the machine that implements this ridiculous bus.)
So indeed, if nothing does anything, #READY will go active automatically, simultaneously with the data lines (not!) being driven, and the CPU will sample junk.
Which is to say: IBM had to add a bunch of hardware to the board just to synthesize a default/ignore behavior for this line, which wouldn't have been necessary had Intel done it right the first time.
On the 8086, the microcode counter would eventually roll over and reach a "next instruction" bit even if it went into a normally unreachable part, so I don't think that such a state is possible.