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The playground's compilation mode is currently set to 'all' along with reporting all errors. This tends to be misleading since people usually expect a 1:1 match between how the playground works with what the compiler does in their codebase, eg https://github.com/reactwg/react-compiler/discussions/51.
React Compiler
React Compiler is a compiler that optimizes React applications, ensuring that only the minimal parts of components and hooks will re-render when state changes. The compiler also validates that components and hooks follow the Rules of React.
More information about the design and architecture of the compiler are covered in the Design Goals.
More information about developing the compiler itself is covered in the Development Guide.