I feel in this case that they would have benefited from having people take turns doing light work and damage control over hte course of vacation, so it turned out it was more of a case of not going completely dark on development, rather them dimming the lights.
Otherwise, yeah, the beta really probably should have waited until Arcen were actually doing work on the game. But, people will be people, and these people won't realize that "beta is beta". Anything I look at that isn't polished, or that anybody reasonable looks at that isn't polished, is going to get glossed over with that same philosophy in mind. For the sake of any betas, you need to have a gigantic disclaimer saying "This game isn't actually finished, so bear that in mind" and you need to be actively working on it. I hope the situation doesn't turn out to be as bad as it sounds.