I'm not sure if I'm allowed to be more elaborate on the subject on this forum. Let's just say it's from the "Y'ARRRRRRRRRRRRR" side of things.
It gets more piratey than an emulator which I already mentioned?
Oh, many games have similar mechanics, it's just most prominent in simulation type racers with Gran Turismo. Given that you seem to be somewhat of a fan, I figured that was where you'd picked up the idea. You did talk about crashing and still winning the race, which is a bit of a GT meme at this point.
I thought that you get to the high levels of difficulty once you know you can handle it well, thus major mistakes are a low possibility.
You may be of the sort that only plays a higher difficulty once you have the skill to not make mistakes. Others like to be challenged and pushed to and beyond their limits.
You'll notice if you watch real racing that even professional drivers make mistakes regularly. Why, if they're so good at it? Because they use that increased skill to push even harder.
Sometimes that affects the overall gameplay experience and you can't disable it - for example, the "gear tips" of newer GTs, simplified puzzles of Portal 2, modern port of Earthworm Jim lacking harder difficulty levels found in original game, etc.
Don't mistake badly designed games and badly implemented features for those features being universally a bad idea. Having easier difficulty levels is never a bad idea. Having them at the expense of other features may be.
Once again, my only issue with the rewind was the fact I didn't know it can be disabled. The shop demo of FM6 never failed to remind me of its existence every time I made a mistake.
You should possibly also know that every demo and the first level of every Forza game generally comes with the full suite of helpers and warnings enabled. It's essentially the training level, it's supposed to get everyone into the game smoothly and show them how it works. That means that for people like you and me who already know how a car works, it's awful. The assists are intrusive and the instructions unneeded.
Once you get into the game you'll find that you can turn pretty much all that stuff off and just drive the car, if you so choose. The granularity of assists is generally superior to GT, and you are offered credit bonuses for turning them off to incentivise you.
The way I see it, you're supposed to perform well for the entire lapse of the race. That's the kind of a challenge I'd expect from a racing game, especially the one that tries to be realistic.
But how realistic are Forza and Gran Turismo really trying to be? We already know that they simplify physics and controls to make the games more accessable. Why is reducing the challenge from "you may not screw up for 5mins/30mins/24hours/however long we make the race" to "you must get all of these individual things right, in sequence, but you can have as many tries and take as long as you want" unacceptable to you? I'd say it actually becomes interesting, one can make really, really difficult races.
Especially if you want to encourage people into longer races than the 5 to 10 minutes that is standard. Repeating 10 minutes is fine. But say you're doing a 90 minute sprint race. Screwing up (or simply getting shunted by the AI) at the 80th minute isn't exactly out of the question. Do it all again? Or acknowledge that you've got most of the way, and you've still got ten minutes to go?
You'd do it again, and that's your choice. But is there really no valid situation in which you'd like someone with less time and dedication to be able to experience that long race and the battle to win it? They still have to try hard in their book, it's just that the effort they're willing to put into a toy car racing game is lower than yours.
If you're marketing to ten million potential customers, I think you have to recognise that at least 9 million of those just want to sit on the couch and hoon around. If rewind lets them practise their mad skidz yo better, then it's great for them. Personally, I love it when playing Horizon. I'm not taking it seriously, I am literally just hooning around in my tuned ridiculous-mobile. When I balls up a corner and go over a cliff I don't stress, I just hit the button and continue having fun.
Ultimately, that's the point. Fun. Never forget.