Modern is better, but many industries are fine with "old" technology. As the pandemic showed, the problem (for industry and mass market consumer electronics) was not Intel/AMD/Nvidia high end chips but chips for washing maschines (had to wait 7 (!) months for a dishwasher b/c Miele had no chips) and cars.

Is modern really better? If you are waiting on a compile, or running the latest game or - other performance critical task of course it is. However for embedded systems older processes are likely to result in chips that operate longer under harsh conditions and so may be better. It depends on the application.

I know where I work we have customers that run our products at -70C and +50C, we can't run a lot of modern chips because they fail our tests at those operating temperatures.

It isn't necessarily, especially if your chip involves some analog or RF design, or must be robust. It is only for increased compute power where the smalles nodes shine

Smaller nodes also do not inherently have better performance for all tasks. They bring performance penalties in some regards, extra costs, and more complexity, which might make something older like 65mm a far better choice