It definitely depends upon the person and is another area where one needs to fit the school and course selection to the student.
Among a group of puppies, some are naturally outgoing and adventurous and some are more wary. Most of the wary ones can do just fine, but they need more exposure. There’s nothing wrong with that. It’s still a “Train up a ‘puppy’ in the way they should go” deal (vs the way one feels “everyone” should be trained up). It’s the end success that matters, not the means to get there. (Success being defined the same for both, of course.)
Students who love learning and challenge often love the big research schools (or any challenging class in any school) - challenge accepted. Others, not so much. It’s all ok. One just can’t put a square peg into a round hole because they think that’s the only way one can succeed. That’s when failure tends to happen.
FWIW, this is not at all about lowering the bar with final knowledge - wanting pure memorization instead of true learning. That’s its own issue and definitely grates on my nerves as an educator when it’s an end goal for any level of learning. It’s been around forever. I recall not really understanding Calc until I got to actually use it in Physics. My students do well in high school because I emphasize teaching them how to reason and think, not because I teach them “Step 1 is to do this.” Granted, vocab has to be mostly memorized, but once that language is learned, most of the rest can be reasoned out. Some vocab can be reasoned out as well if one knows root meanings. The teachers considered the best by students at our school are those who teach (in an understandable way) using concepts for real life applications. But that’s totally different than whether a student will do better with challenge or confidence building.