Little of both as I understand it.

Privacy sandbox had some sketchy innovations that would let google track people (but would make third party tracking harder).

There was some legit good things they were pushing and cookies (as they existed at the start of the initiative) were very flawed in their implementation. Some things have become better kind of on their own.

Overall, we're probably best off that they started the initiative, inspired other privacy changes (outside privacy sandbox), and then ultimately gave in before "completing" the project.