I have seen it done, cutting the bottoms of the cups off a cardboard carton to make sort of a frame rather than a carton.
The thoughts (as I was told) behind it are 1. if humidity is too high and the internal pip hits water, the chick won't drown. I am not quite sure how this would help, because water would still flow downhill to the chick. 2. It will keep hatched chicks from rolling all the other eggs around. But they usually manage just fine even if they get rolled. 3. you can stuff a lot more eggs in the hatcher. This is true. However, the chicks have to have somewhere to go after they hatch, and need room.
I use as bare a box as I can for a hatcher. Thermometer, wet sponge in a pint ziplock, temp sensor, eggs. Done.