I mean the conspiracy theory side of it is questionable but the basic facts are true:

1. Wikipedia has a policy against non-notable things. They were always embarrassed by the fact that every detailed version of every Pokemon had its own page, whereas the pages for important historical events were stubs. The WP:Notability standard has been the bane of every garage band and open-source game and DVD extra that was booted off the site because trivia cannot meaningfully be checked, trivia that otherwise allows hoax articles to live on.

2. Jimbo Wales decided to profit off of the desire to create fan-encyclopedias or even complete nonsense (like, for example, Penny Arcade's Elemenstor Saga wiki, which details the history of a novel series and anime and cardgame that never existed) by creating Wikia, the for-profit Wikipedia that had no standards about what you could put on it besides legality. Just create your own Wikia and run it with an iron fist.

Now, the question is whether he did (1) in order to drive profitable users to (2). That's where the conspiracy question lives. And I tend to assume good faith. People's morals erode over time, not all at once. Since both (1) and (2) are totally legitimate, but profit motive encourages the millimetre-by-millimetre enshittification of Wikia into the horrible thing it is today.