I wear a Freestyle Libre. Even during their mandatory onboarding, they warn about incorrect readings for the reasons you described and urge you to verify the glucose level with manual measurements when in doubt. Also, it's better to just eat glucose when the CGM shows a rapid decline or low level, even if it's due to an inaccurate measurement. This is in contrast to accidentally applying too much insulin and forcing a low glucose level. Of course, low levels often present with very obvious symptoms.
However, the FDA announcement warns about constantly low measurements. Unfortunately, the announcement does not explain what 'low' means in this context and what the actual issue was (it might be technical with the sensor or with the applicator). If it means that glucose levels are too low in terms of 'alarming low', this should prompt manual measurements. However, if the measurements show incorrect levels within the 'normal' range, this is a much bigger issue with these devices. This could explain why affected people have changed their diets or medication plans. These changes should always be discussed with a physician, though. Disease management programs can catch this (e.g. quarterly measurements of HbA1c).
CGMs are helpful. But they require knowledge about their limitations, especially for people who need insulin. They helped me to bring my glucose levels back into normal range without the need for any medication. I hope, I can keep my insulin intolerance at bay for a long time this way.