I personally think it's a bad thing, unless you have a specific use case in mind. For 99.99% of use cases, rectangular screens are a pretty good choice.
For example, I don't really have a problem with the way Youtube presents itself on the iPhone X screen in landscape mode. It's not perfect, but nothing is actually breaking. There is some unused screen real estate. There isn't so much a falsehood here as an aversion to a more sophisticated screen filling methodology. If someone were to view YouTube in a screen shaped like a circle, the YouTube developers would have a strong argument that's not a fact of life but an oddball thing to do, and consequently not support it.
Conversely there are legitimate consequences if you make false assumptions about e.g. foreign language encodings, email validation, characters present in human names, etc. These are domains with edge cases that have a huge number of unknown unknowns due to very culturally significant and non-dismissable reasons. You also can't really skimp out on designing for them because doing so could completely break functionality or introduce security vulnerabilities.