In that you always test against only the versions you have deployed + new version of single service.

Which downplays your exaggerated 1024 cases to 1.

OK, but then you have a very controlled way of deploying each service.

Each team can't just deploy a new version of their microservice when it makes sense to them.

So your collection of microservices becomes a bit of a distributed monolith, losing some of the classic microservice advantages.

Or so it seems to me. I just read about this stuff, have never used it. Happy to be educated.

Its losing „some” adventages of startup grade microservices and gain maintainability adventages of „netflix/facebook” level grid... Depends whats your scale. Shipping shit fast is often not the best solution at that scale, doing it right is. And I have already explained to someone else in this thread why that approach is important.