I concur that it's risky but this is also common place in repair shops. I would consider this a viable option but would hold off on using it until I've exhausted all other efforts. Basically, make this the last attempt before you send it off for forensic level recovery.
"Common" doesn't mean "good practice." Yes, it's "capable" of working (in theory), so viable in that sense. But completely not viable in the sense it could destroy everything! It may be "common" in "repair shops" (run by people who doesn't have a deep understanding of hard drives and data recovery) but it's never even considered as an option in a data recovery shop.
By doing this you are putting your customer's data at risk. Sure, it's a good thing for
you to try, since if it works
you get paid. But if it doesn't work, your customer may loose their data. I assure you it's not worth the risk for your customer (95% of the time). I recommend offering this as a last resort option to your customers (for example, if they can't even afford to pay $300 for professional data recovery or the data isn't worth that much), but just doing it because nothing else works is sloppy, careless, and dangerous.
DiskWarrior first scans the partition, constructing a snapshot of the system. Once it's created the snapshot it mounts the snapshot as a read-only partition. This is commonly used for data recovery for systems that won't boot or mount properly. DiskWarrior will often (75-80% of the time in my experience) mount the snapshot, which you can then pull data from using CP in Terminal or other copy methods. Once you're comfortable that the data is secure elsewhere you can then proceed with the repair through DiskWarrior, which may or may not be successful. Along the same lines as ddrescue but with a GUI and fairly strong repair tools built in.
It's very good that you are moving data from the "preview" DiskWarriored drive, rather than replacing the entire catalog file on the bad drive.
But, it's the catalog scan that can wear out a drive when it has bad sectors or physical/mechanical/firmware problems. DW doesn't attempt to recover bad sectors. It is much safer (and you'll have better success with DW) to clone the bad/suspect drive first (using DDrescue or Deepspar). Then you can run DW on the clone.
This way the bad drive itself isn't being used (and isn't being further damaged). Plus, once you have the clone, you can try many different apps. If DW doesn't help, you can try DR3 or R-Studio, all from the same image (instead of re-running all these apps on the same failing drive, which is potentially getting more and more damaged with every scan).
Please let me know if you have any questions or need more clarification about something. Explaining the best practices for data recovery helps everyone (you, your client, and the data recovery shop that ends up with the drive if you can't recover it).