I personally think a lot of fancy goldfish and those 'balloon' fish they sell are pretty deformed looking.
But talking about bettas specifically, I do have a young fish here, that as a fry, had a spinal deformity so bad his topline looked like a concertina fold. However, because he was matching the growth rate of his normal sibling without any special care, I thought I'd let him live and see what happens. If the issue didn't correct, I would cull.
Astonishingly, over time, his spine started to straighten up and now there's only a very small divot in front of his dorsal fin.
I still don't know how his organs functioned properly when he was younger as his whole body looked like it had been put into a compactor. Most of the fry I have with significant deformities like that, die off when they are forced to compete against their healthier siblings. However, I think because there were only the two of them, 'Zig-Zag' stood a better chance at survival.
But I do think fish like the fish in the OP should be culled. Some hobbyists are drawn to the unusual, and I worry that such a fish could find its way into a breeding tank somewhere.