I landed on it being a red flag, but nothing so bad that I’ll stop supporting them for now. But given that it’s a paid service, part of what I am paying for is for them to provide a better and more ethical alternative to known free engines. In turn, this means that I hold them to very high standards.

I’m guessing after the backlash over this they will be even more careful going forwards. It’s impossible not to make mistakes now and then, and though I agree with @poVoq that Kagi’s response here reflected that they had not thought certain issues through enough, I choose to be patient with them for now. At least they are making an effort to communicate rather than just giving empty corporate responses that mean nothing.