For interest, this popular pastime goes by several delicious names: https://en.wikipedia.org/wiki/Least_publishable_unit
I don't question this decision is sometimes (often) driven by the need to increase publication count. (Which, in turn, happens because people find it esaier to count papers than read them.) But there is a counterpoint here, which is that if you write say a 50-pager (not super common but also not unusual in my area, applied math) and spread several interesting results throughout, odds are good many things in the middle will never see the light of day. Of course one can organize the paper in a way to try to mitigate the effects of this, but sometimes it is better and cleaner to break a long paper into shorter pieces that people can actually digest.
Though truthfully it's hard to say what's better. All can be hacked (a common way to hack citations is to publish surveys. You also just get more by being at a prestigious institution or being prestigious yourself). The metric is really naïve but it's common to use since actual evaluating the merits of individual works is quite time consuming and itself an incredibly noisy process. But hey, publish or perish, am I right?[0]
[0] https://www.sciencealert.com/peter-higgs-says-he-wouldn-t-ha...
It depends. If your goal is to get a job at OpenAI or DeepMind, one famous paper might be better.
Some irony is my PhD was in machine learning. Every intro course I now (including mine) discusses reward hacking (aka Goodhart's Law). The irony being that the ML community had dialed this problem up to 11. My peers that optimized this push out 10-20 papers a year. I think that's too many and means most of the papers are low impact. I have similar citation counts to them but lower h-index and they definitely get more prestige for that even though it's harder to publish more frequently in my domain (my experiments take a lot longer). I'm with Higgs though, it's a lazy metric and imo does more harm than good.