From the library in Diamond/Pearl/Platinum

A young man, callow and foolish in innocence, came to own a sword. With it, he smote Pokémon, which gave sustenance, with carefree abandon. Those not taken as food, he discarded, with no afterthought. The following year, no Pokémon appeared. Larders grew bare. The young man, seeking the missing Pokémon, journeyed afar. Long did he search. And far and wide, too, until one he did find. Asked he, "Why do you hide?" To which the Pokémon replied... "If you bear your sword to bring harm upon us, with claws and fangs, we will exact a toll." "From your kind we will take our toll, for it must be done." "Done it must be to guard ourselves and for it, I apologize." To the skies, the young man shouted his dismay. "In having found the sword, I have lost so much." "Gorged with power, I grew blind to Pokémon being alive." "I will never fall savage again. This sword I denounce and forsake." "I plead for forgiveness, for I was but a fool." So saying, the young man hurled the sword to the ground, snapping it. Seeing this, the Pokémon disappeared to a place beyond seeing...

Long ago, when Sinnoh had just been made, Pokémon and humans led separate lives. That is not to say they did not help each other. No, indeed they did. They supplied each other with goods, and supported each other. A Pokémon proposed to the others to always be ready to help humans. It asked that Pokémon be ready to appear before humans always. Thus, to this day, Pokémon appear to us if we venture into tall grass.

I've always interpreted that Pokemon choose to show up and challenge humans when they want to join them, and will flee/not show up if they don't want to be with people. Pokemon are clearly stronger than humans and will straight up not listen to you if you don't have enough badges.

Also, battles don't seem to be "real fighting' in the way that they get injured or anything. Real sickness and injury, death, etc are presented as something completely different from status effects and fainting.

Okay, thats my incredibly nerdy take.

Anyway, I'm not so offended by Palwords "animal exploitation" joke as much as it makes me roll my eyes in a "Mario is high on mushrooms lololol Mario is possessing people with cappy lolol" way. It an old and easy joke. I feel like entertainment is nihilistic enough as it is.

I think a better idea would be a game where the Pals are being exploited by the bad guys and you free them and lead them in a bloody revolution for freedom lol.