From what you said, i would honestly love having Beige Edition as it's own thing. Yes, as a fully-fledged, standalone game with a seperate game engine.
If the team would've done this, it could be beneficial as for one, they don't have to strictly follow the 1999 model cap. They could've included some of the more malaise 2000s cars, added more content like tracks, features, and gamemodes. But maybe they could still keep the PS1 graphics, they're very whimsy
But the kicker is that, since it would be classified as it's own thing, and as the team didn't have permission or guidance from the makes featured, standalone Beige would've been very vulnerable to get into a legal issue. Making Beige under the guise as a mod is a bit (or maybe way more) safer and time-saving than making it it's own thing from scratch.