What you noted of engineers going down rabbit holes of cool tech for cool tech sake is certainly an issue, which is why management must help keep in mind that the autonomy is given with a goal of "solve business problems." It requires a bit of careful management but it usually becomes clear over time who enjoys playing with new tech for the sake of new tech and who does it to try to find a solution to a problem. The former group can be put into a research team if the company is large enough otherwise they are likely not a good fit.
As for risks, the biggest problem I've seen from this cultural change in a company is the disharmony it creates between the people who enjoy task-driven work and just working their 9-5 vs. the people who enjoy creative problem solving. It usually works better to have that culture from the start and also why it is so hard to change a company's culture to this way of working because it disrupts a way being that almost everyone in the company is used to.
As for risks, the biggest problem I've seen from this cultural change in a company is the disharmony it creates between the people who enjoy task-driven work and just working their 9-5 vs. the people who enjoy creative problem solving. It usually works better to have that culture from the start and also why it is so hard to change a company's culture to this way of working because it disrupts a way being that almost everyone in the company is used to.