I think what constitutes “genre blending” is going to vary for a lot of people. I also think what goes “too far” may vary, but it has a lot to do with how well the genre being mixed in “plays fair” with the rules of the primary genre being presented.
One thing I keep seeing brought up that is interesting to me is Spelljammer. Spelljammer never really alluded to starships with fusion drive engines or laser beams or advanced technology, and the “physics” of Wildspace intentionally don’t model the real world at all, and were jokingly called “Grubbian Physics” after Jeff Grubb.
You have a magic seat that lets a wizard make a ship fly, and anything big enough that breaks the surface of a planet “naturally” pulls along a pocket of air. Stars might be portals to the plane of fire, or giant lanterns hung by the gods, or whatever, and it varied from Crystal Sphere to Crystal Sphere. In some systems, planets orbited a sun, in others, a sun orbited a planet, and in others, planets were literally hung in the boughs of a giant tree.
While it was definitely “out there” fantasy, it was definitely fantasy, and not scientific at all.
I do agree with the point made on the show, that the worst “genre blending” comes when a product plays “gotcha” with the characters.
Using Pugmire as an example–the game on its face is D&D, but with dogs, but the setting is actually a post-apocalyptic setting where humans no longer exist, and while there are essentially clerics and wizards, what the characters don’t know, but the players should, is that the dogs were genetically advanced to be sapient bipeds, and their “magic” is actually their imprecise access to ancient human technologies that appear to be magical to the dogs, who have an incomplete knowledge of the humans that disappeared from the planet.
All of that is explained up front. It’s not a sudden gotcha moment that “oh my gosh, all magic is really just science!”
While people don’t often balk at incorporating horror into fantasy, the degree to which Shadow of the Demon Lord’s underlying conceits are more horror than fantasy isn’t 100% evident in the core rulebook, but the core rulebook does constantly warn you that reality and the truth behind the veil is horrible, so when you come across some of the truths in Exquisite Agony and The Hunger in the Void, they can be a bit of a gut punch, but the foundation for the reveals was fairly laid down in other material.
On the other hand, dropping people into Wonderland or having them fight robots when you don’t know if they have experienced pulp fantasy where such things might happen, and you haven’t established if that’s the kind of thing that “could” happen in the game setting, feels like it might cause some disconnect for some players.
And this is coming from someone who used Freddy Krueger in a Ghostbusters RPG session and thought it would be cool back when I was in high school. It was not, indeed, cool, at least judging from the reactions of the players.