Spin-off from ✨ Add Alpha level Experimental Package Manager module Needs review .
Automatic updates allows sites to run both AU + composer patches at once.
Composer patches is incompatible with actually updating a site automatically, because as soon as a patch is committed upstream, or an upstream change causes a conflict, you need to manually determine the problem with the patch and either replace it with a newer one or remove it - both of which require manually editing JSON.
Additionally, applying patches that include update paths is very high risk and can leave a site in a state where it's not possible to update the database successfully - e.g. if a different update takes hook_update_N().
However, this is not a barrier to using project browser, or some advanced AU use-cases where a developer is prepared to manually intervene every so often and AU is only expected to handle what it can handle.
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11.0 🔥
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I agree with not allowing composer patches by default, for the reasons explained in the issue summary.
Tagging this as a package manager/automatic updates beta blocker, we could potentially move it to a stable blocker later but should at least discuss more before beta.