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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.