Bricked 3DS, but suspicious

So I have a banged up modded old 3DS and it had a problem with the dpad, so I opened it up to fix it. When I put it back together, I got this error message.

The 00000400 error code is a NAND problem according to the internet, so I thought it was game over.

But I realized that I'm still able to boot into Luma3DS just fine. Even GM9 will "boot" up (it stays stuck in the loading screen, but it still shows up). Is this normal behavior for a bricked 3DS? I asked the Nintendo Homebrew discord community, and they said it shouldn't be able to do that. Their theory was a fake splash screen, but changing the splash screen settings did nothing to fix it. We tried updating Luma and Godmode9, but nothing changed.

Was the Discord just wrong, and this is normal behavior for a bricked 3DS?