Am I reading correctly that 'hatchery quality' means less good?
Just in the sense that they arent show quality birds but are still solid or more equivilent to like a puppy mill where its mass production and unethical inbreeding and health problems?
Mostly just not show quality.
Health and inbreeding are usually fine (possible exception for very rare breeds, but those will be inbred no matter who you get them from.)
Hatcheries tend to have enough birds that inbreeding isn't a big problem.
Hatchery birds are usually better layers than the same breed from a breeder (exceptions exist, of course.)
Points where hatchery birds are not as good:
They are often the wrong size, with the small breeds and the big breeds tending more toward middle sized.
They sometimes have wrong combs, or wrong color of earlobes or feet, or lack some special feature they should have (hen feathering, beard, feathered feet, extra toe, etc).
They often have coloring that is a bit wrong, usually looking like a sloppy version of what they are supposed to be.
If they are supposed to be dual-purpose or meat-type, they usually do not grow as big or as fast as they are supposed to. (Exception: Cornish Cross from a hatchery will grow faster and bigger than any other chicken you can get. They really are the best for that.)
Personally, I tend to like hatchery-quality chickens. I don't show chickens, I want eggs more than meat, and I like being able to order a bunch of different breeds that will look close to "right."