This makes the free plan less then useless, it makes it a footgun. I'd rather a service offer me a time-limited trial and then cut me off rather than play with my data like that. Someone who's less experienced might disagree and lose their data instead, and isn't that a bad look for everyone involved if it happens.

If you can't afford to offer a viable free plan, don't? If I go to a baker and they offer me free breadcrumbs, they should at least not be mouldy.