I don't see that as an improvement or a recognition of what is wrong with "cyberpsychosis" and related concepts. People live with severe trauma, severe chronic pain, and severe psychiatric problems and manage to keep it together. Pondsmith is making up excuses to keep "wheelchairs make you evil" in his game instead of recognizing the notion for what it is and discarding it.

I think it's a good example of ingrained, reflexive ableism. It's a holdover from archaic 20th century beliefs about disabled people being less human, less intelligent, less capable. Cybernetics are not a good metaphor for capitalist alienation or any other kind of alienation. They are, no matter how you cut it, aids and accomodations for disability. You just cannot say that cyberware makes you evil without also saying that disabled people using aids in your setting are alienating themselves from humanity and becoming monsters. If you wanted to argue that getting wired reflexes, enhanced musculature, getting your brain altered so you can shut off empathy or fear, things that you do voluntarily to make yourself a better tool for capitalism, gradually resulted in alienation, go for it.

Ghost in the Shell does a good job with that. Kusanagi isn't alienated from humanity because she's a cyborg, but her alienation from humanity grows from questioning what it means for her to be a cyborg, a brain in a jar. She's got super-human capabilities - she's massively stronger and more resilient, she's a wizard hacker augmented with cyberware that let's her directly interface with the net in a manner most people simply don't have the skills for. Her digestive and endocrine systems are under her conscious fine control. These things don't make her an alien or a monster, they create questions in her mind about her identity, her personhood, and how she can even relate to normal humans as her perspective and understanding of the world moves further and further away from them.

And this isn't a bad thing. It doesn't lead her to self-destruction or a berserk rage. Instead it leads her to growth, change, and evolution. She ambiguously dies, but in dying brings forth new life. Her new form is not an enemy of humanity or a threat, but instead a new kind of being that is a child or inheritor of humanity, humanity growing past it's limitations to seek new horizons of potential.

The key difference is Kusanagi has agency. The cybernetics don't force her towards alienation. They don't damage her mind and turn her in to a monster with no agency. Kusanagi's alienation grows from her own lived experience, her own thoughts and learning. They grow from her interactions with the people in her life and her day to day experiences. Her cybernetics are an important part of that experience, but she is in control of her cyberbody. It is not controlling her and turning her in to a hapless victim.

Basically; the Cyberpunk paradigm says that using a wheelchair makes you violent and evil. The GitS paradigm says using a wheelchair makes you consider the world from a different perspective. In the former disability, both physical and mental (false dichotomy I know) is villainized and demonized. In the latter disability is a state that creates separation from "normal" people in a way that reflects the experiences of real disabled people, but is otherwise neutral.