Not always. Many games don't get physical releases, or only get an expensive limited-run physical collectors edition, and when they do get a physical release it doesn't necessarily even contain all of the game data so part of it may still have to be downloaded.
The latter is apparently going to be even more common with the Switch 2 due to the high cost of its faster storage. Nintendo is now giving publishers the option of releasing "game key carts" which contain zero game data and are essentially just DRM dongles that grant permission to download and play the game.
The other problem with incentives around bricking devices sold for a loss is that when the seller is big enough to absorb a bit of negative PR they also have no incentive to address false positives or small infractions, any time spent dealing with these users is viewed as compounding the loss. It also generates a bunch of electronic waste as a consequence.
I'm not positive this is possible. I seem to remember times when trying to play a newer game on the Switch required a system update, even though I had the physical card. I might be misremembering, though.