It's all good in the end. For 25 years of my life I thought everyone faked being happy. I now know that it actually is possible to be happy :).
I might sometimes get triggered by certain textures while I am eating, but I am able to trust people and tolerate being hurt without totally shutting down and enjoy my family and work and leisure.
Some people are tremendously evil, but most people are surprisingly resilient. We didn't get thru human history without being able to overcome a lot.
And the other part - the consequences - need to be addressed too. Many people I know are in a mental health program of sorts, myself included although that was mostly last year and nothing major. But a lot of people in their 30's finally have the awareness that something is not right, the time/means to pursue it, and the access to mental health, and get a lot of epiphanies on themselves - be it trauma, neurodiversity such as ADHD/ASD, etc. At least four adults I know have started on ADHD medication and have had an emotional moment where for the first times in their life their head emptied and they could think straight or not go through a dozen mood swings a day.
But we're in a mental health crisis; a lot of people grew up with "just suck it up", "deal with it", "there's others that have it worse", or "this is normal", but thanks to awareness, the internet, and reduced stigma to talk about mental health, there's a lot of people now who realize they need help, which is overloading the mental health systems. In my country there's at least a year long wait period for some of the most vulnerable people (teenagers), which is a big problem because teenagers are also more neuroplastic still, so they would benefit the most from mental health help compared to people in their 30's.
TL;DR, while the root causes from an older generation will be difficult to solve, I have high hopes for a younger generation that has more awareness and access to mental health problems and who can hopefully resolve their own issues growing up and not pass it on to the younger generation.
However, I'm also aware that the above is a very "western" point of view; there's plenty of situations worldwide, right now, that will result in generational trauma for decades to come yet. The people currently living in warzones, poverty, etc will never be the same again. "Our" generation is the children and grandchildren of people who lived through WW2, who themselves or whose parents lived through WW1 and the Great Depression, and this generational trauma is still very much affecting "us" today to lesser or greater degrees.
For me, I've always struggled with being overly cynical. I can't let nice moments be, and I can't let accomplishments lie.
I feel like I'm somewhere on the journey you are on, and I hope to get to the same destination.
I'm fairly sure I'm in the avoidant quadrant; as to what caused it, I'm not entirely sure but the things that fit are that my mother was very ill when I was 3 (thrombosis, she spent a few days in ER), and that a friend who sort of "saved" me from being all alone at school just left one day (her parents moved), which re-emphasized my already present feeling of "shouldn't get too attached". The rest was probably self-inflicted, feelings of superiority / being more mature than the other kids, fear of rejection, etc. But it adds up and resulted in growing up awkward, immature, single, boring, etc. I'm 38 now and have been through some mental health stuff, but it's expensive (since it's not clinical) and ultimately pointless unless I throw my life around, become a more social person, and get a lot more reinforcement that I'm wrong and my cynicism is not justified. But instead I get reinforcement that I'm not wrong. To a point that becomes a self-fulfilling prophecy, but at the same time society is going through a loneliness crisis and focused on individuality, so... I'm not wrong?
Anyway; avoidant attachment theory, have a look.