It doesn't matter whether it's "from a repo". If you can't trust the repo it can feed you whatever it wants.
(Those templates, once rendered, might then refer to pods, etc. that might be put into a k8s cluster (or perhaps we merely render then YAML, and never `apply` it), and in that sense, one might imagine that that is an install, but that's not the security boundary being crossed here; this would presumably result in execution on the host running helm, which would definitely be surprising.)
Certainly, it would be better to trust the upstream completely, but let's not kid ourselves? See the entire current state of software supply chain in the industry.
But when I visit a website, I don't expect the website to LCE me. Why should turning a YAML adlib into YAML LCE me, regardless of the trust of the upstream. This is not a privilege I'm expecting to give the upstream ever, and this behavior is a clear security bug, to me…