The build tool is open source and unlike a Jupyter notebook, it’s easy to edit without a custom editor. So you don’t need their editor, but it will still be nicer to edit with their editor.
D3.js started as/still is just a (collection of) JS libraries. Then Observable came along, and while it is a nice tool for tinkering with D3, it was not at all obvious how to then move your finished Observable D3 viz to a fully self-hosted, regular website (without paying a subscription to use their custom runtime or servers or whatever).
Now I guess they realize they strayed way too far from "the web" and are back-tracking.
FWIW, the HTML custom elements spec does require a hyphen: https://html.spec.whatwg.org/multipage/custom-elements.html#...