I see the sqlite hype as a (legitimate) pendulum swing away from defaulting to 'web scale' everything to a realization that most of the systems we design don't need it.
On the other hand, when you start mixing in new tech like litefs to paper over shortcomings in the fundamental nature of an alternative, I start to question the sanity of the choice.
We have screwdrivers, hammers, wrenches, let's not select a wrench and wrap it in a 'screwdriver adapter as a service'.