For what it's worth Yarn 3 implements essentially all modes. It can do standard node_modules, its own Plug'n'Play, as well as pnpm-style hardlinking to a global cache.
Edit: I just learned from another comment that PNPM also supports Plug'N'Play :) Thanks steven-xu!
Both pnpm and Yarn are independent projects maintained by the community. I personally think that these are better projects than npm CLI because they can make their own decisions. Not decisions dictated by business needs of a company.
I was OK to merge pnpm into npm in the past. They have never suggested me this opportunity. Instead, they decided to re-implement pnpm's algorithm into npm and call it "isolated mode".
Most of my problems were created by the material UI libraries (I wanted to use them with SvelteKit), but I just got rid of it as those libraries were making development harder instead of helping.
I still wish there would be a nice UI library for Svelte, but I guess that's the disadvantage of not going with the mainstream frontend toolkit.
Edit: I just learned from another comment that PNPM also supports Plug'N'Play :) Thanks steven-xu!