Earlier quoted context omitted.
Agreed this is akin to HTTP 200 {"error": "Not found"}
Not at all! It's like porting a program which expects there to be a TCP stack to a system which doesn't have one, and wiring up a component which responds to all HTTP requests with 404 instead of letting it hang on an infinite loop or crash. Say it uses a browser for rendering, but in the original you can also fetch websites, and the assumption is deeply baked into the code. If your choice is between playing whack-a-…
How is a 404 equivalent to not throwing an error? 404 would be like throwing the error and then not handling the 404.
And the equivalent of hanging and crashing in the xbox example would be hanging and crashing.