From what I have read, sidechains play a very critical role in increasing the scalability of bitcoin.
Side-chains can not scale bitcoin, they are completely different blockchains that don't even have to use a 1:1 ratio with bitcoin and their coin. For example there could be a side-chain where you "deposit" your bitcoin and receive 1000 tokens for each bitcoin!
Many are firm in the fact that the base-layer will continue to remain as simple as possible to ensure the security of the protocol.
It depends on what you mean by "simple", if you mean that bitcoin doesn't have the "token creation" capability then you are right bitcoin will always remain simple but at the same time Bitcoin protocol is not simple at all, it has very advanced capabilities and can handle many types of complex smart contracts required of a decentralized payment system.
My concern is, some of these projects are outfitted with their own native coin.
If they are side-chains they have their own coin on a semi stand-alone blockchain.
Could this be a problem?
As long as they aren't spamming bitcoin blockchain, no.
Or should we welcome any project that aims to bring scalability, smart contracts, NFT's, and DeFi protocols to bitcoin's ecosystem?
We first have to see if there is any real problem in the real world that these token creation methods solve or are they just passing fads. I say it is the later so I don't welcome them.
these alt currencies (ETH, BSC, SOL)
These aren't "currencies" they are tokens themselves. For example they even refer to ether as "fuel" (for smart contracts) not a currency in their definition.
are simply testing grounds for when bitcoin has all of this built on its own infrastructure.
Nah, they are money grab projects which is clear from their pump and dumps, premines, fund raisings and centralization.
I am struggling with how smart contracts may be a fad.
It may be because you are using the wrong term when you mean "token creation methods".