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This is about the Raspberry Pi Pico 2 (based on the RP2350), not the original Raspberry Pi.

And is it better with bad cooling?

It's better with absolutely no cooling. It doesn't even consume (and thus dissipate) 100mW flat-out.

Maybe they should have branded it differently …

They did, it's the Raspberry Pi Pico (as opposed to the Raspberry Pi) as a dev board or the RP2350 (as opposed to the BCMXXXX) as a chip.

Seriously. Different. Eh.

Yes.