That's one of the key points of Bottles. Wine instances are isolated from your system installation. Both the data and runtime. You update wine manually through Bottles if and when you want.

I want to try Bottles again to see if it really does solve more problems, but I honestly find it a bit disappointing how there isn't really that great of a solution for managing Wine prefixes holistically. I always wanted to like Crossover, because I like Code Weavers, but in the end all of the solutions felt like ducktape over the problems.

Which might make one think that it's hopeless, but clearly it isn't. Steam shows us that this sort of concept actually can work reliably. I don't know how Steam actually manages the prefixes, but you never have to think about it and it always chooses a known-good Proton version. Lutris seems like it wants to do the same basic thing Steam does, and it is very useful, but often times Lutris's "known good" settings somehow don't work.

This is a shame, this problem feels like it can be solved and make Wine vastly more useful. (Though in the end, improving upstream Wine will always be better than trying to build layers on top of it like this... but building layers on top of it like this helps us with running Windows software now, which is still pretty useful.)

Aside from having better automatic bottle management and setup of software with "known good" settings, I'd like to see more things tried. Some software doesn't actually need a persistent prefix... maybe there could be a concept of an ephemeral prefix of some sort instead, to make those softwares work more reliably. And when software does have a prefix, it sure would be useful to be able to "undo" things, using snapshots. Features like this would go a long way to make Wine prefixes easier to manage for people who are less technical.

Isnt proton wine version for games that Valve pays Codeweavers to make?

I believe Valve and Codeweavers collaborate on Proton. However, Proton is very similar to upstream Wine in practice, and you can use Proton as a drop-in replacement for Wine if you want to. Lutris will happily download and run builds of Proton for you.

As far as I know, Bottles already have bottle snapshots

Nice, it looks like you are correct. I think that's a genuinely very useful feature and I'm glad to see it implemented.