If you don’t like it, turn it off.

This would be a valid complaint if it was forced on you, but it isn’t. You can both ignore the warnings and disable the feature entirely.

As to why it does that, it’s using heuristics based on the APIs the app calls and maybe a bit about how it calls them. If there are enough patterns similar to malicious apps, you get a warning.

Is it better to try and fail 10% of the time, or to not try at all and fail 100% of the time?

Play protect is an extremely useful feature that deters uneducated people from installing APKs because yes, the vast majority of times for normal folk, they are malware ridden. Google does try to prevent malware from getting on the play store, and they actually do a phenomenal job, but in the end, it’s always going to be a cat and mouse game, and shits gonna slip through. It’s still better then not trying at all.

I too use droidify and unobtainium and have never received such pop-ups. I guess if it warns you there’s the possibility the app is malicious or requests sensitive permissions.

I’d imagine it’s a way to sift normal users that might turn into power users, so they stay in Google’s controlled environment. Or, since apparently Google can modify programs in the Play Store if they so desire, maybe it’s a way to increase the chance the user will keep using approved backdoors/tojans/spywares. Either way, I can’t recommend enough for people to use vanilla phones, and have some cheap, second hand one just for stuff you can’t use without Google Play.