I think I got the whole Production Kawaii Gen3 story down now, though a few things are me filling out the gaps with what makes most sense to me going by what I know about the personalities of each person.
So let's look at it in detail:
Debut
7 months ago Gen3 had their debut.
Aletta's Dog Reveal Stream
In one of the first streams Aletta did a "dog reveal" stream, where she actually streamed with a camera showing her complete bedroom.
In this stream she talked a lot about her bad childhood memories, she also mentioned that she suffers fear from leaving her house. In that very stream I pointed out that it must be hard having a dog when you are unable to leave your house, in which Aletta replied that the dog actually helps her to go outside and that she couldn't do it without the dog. This will be important later in the analysis.
This stream was deleted after only a few days. I don't know exactly why, but either management deleted it because actually showing real life footage of your whole room was against the company's rules (most likely reason) or because Aletta realized she revealed too much information about herself in it.
Company Rules
While we're talking about company rules, let's analyze the known rules the company has. The company once had two rules that no longer exist which are "you can only stream up to 3 hours" and "you can only do 2 collabs per month". Charzu confirmed this in the stream where she talked two hours about the events.
We should also note even though Production Kawaii is a small startup company, it's still a Japanese idol company and follows common rules of an idol company such as no public contact to male people.
While not exactly knows how much % of a share the company gets, Charzu explained that sometimes the company might go a bit too far in what cuts they take in regards to Merch, but she could always go to the CEO and complain about it and after a while, it was fixed.
Finally, how much do the talents need to work? While it was never officially confirmed, I'm pretty sure that the rule at Production Kawaii is: At least 3 streams per week.
Why? Well first of all, if you look at the least active talent's streams it's exactly 3 streams per week. Also if you remember Aruru Gray, she had a really busy real live so she could only stream on the weekend due to studies, but she always had to do a stream on Friday too. So yes, I'm pretty sure it's at least 3 streams per week.
Also considering that the company actually wanted to put a "only up to 3 hours per stream" rule, we can assume that the company is not actually requiring too long streams.
Let's keep these things in mind for later.
Peony is Pon
Anybody following Peony will know how many mistakes Peony makes while streaming and that she is completely technically inadept. From various audio problems almost every stream to she accidentally doxxing herself completely, she ran herself into a lot of trouble. Is various of her streams Peony would say "Thanks for sticking to me despite me being so bad at this".
Let's face it, Peony didn't have very high confidence in her abilities.
Sava / Miryu
Unfortunately I don't know too much about Sava and Miryu because I didn't watch them too often.
But I will note here that I see Sava as the only "leader" type in this just graduated group. I will point out what confirmed this to me later, but Sava has organized these "Sava Springs" collabs with the other Gen3 members. Notably she collabed with Peony and Aletta first and never with Oceane.
Miryu is the most idol-like of the group and actually fit best into an idol company out of the four.
Oceane getting excluded and then fired two months ago
Now here is where it really starts getting interesting. So what happened here is that apparently Oceane talked bad about and revealed personal information of other company talents and was fired because of this. I'm pretty sure the people Oceane attacked were the Gen3 talents and Gen1&Gen2 were mostly unaffected by this, but I don't remember 100% anymore (I think mostly Peony and Sava were affected by these attacks).
However, in the new lights of what happened now, with all four members graduating together to create their own indie group, we should take a look at this event again.
Now what I think actually happened here is that Sava, Peony, Aletta and Miryu formed an internal friends group and excluded Oceane. Oceane probably didn't like them so much, maybe she knew something about them that others didn't, such as that they are not trustworthy. But Oceane basically just said screw it I'll just do my own thing. She created her own fan discord and connected stronger to her fans that her genmates. I don't think she intentionally "doxxed" anyone to get them into real life trouble, but she probably talked with her fans in the way of "And Sava man she is X and Y and Z, pathetic. Don't let me get started about Peony, who is A and B and C."
This didn't sit well with the four Gen3 member friends group and so they told management.
Now there is one more interesting thing that was said in the Gen3 graduation video: "The four threatened us with graduation before already"
For me, it's very likely that this was to get Oceane fired. They basically went to management and said "Fire Oceane or all four of us will leave!"
Now I will not say Oceane is completely innocent here either, but if it wasn't for that threat she might just have gotten bonked by management rather than fired.
At this point the company seemed to have no choice. Losing four members would just be way worse for the company than firing a single person that actually broke some of the rules in the contract.
But I bet they sure wish they had let the other four members go and kept Oceane as the only Gen3 member if they had known what happened a month later.
Reina jumps in
After Oceane got fired, Reina, who is let's say a "with the power of friendship we can accomplish everything" type (she can also sing really well), starting to realize that those four Gen3 members had isolated themselves from the rest of the company and that was the root of problem which also lead to Oceane getting fired. (Note: All I'm saying here is 100% confirmed by Reina in her stream about the situation from today.)
So what Reina did is try to include Gen3 more by talking to them daily and trying to collab with them (she did join a Sava Springs stream last month!).
She did this without management or other talents being aware of it. She felt that she was on good terms with Gen3 but also said that in hindsight she failed stopping the Gen3 group from feeling isolated.
Gen3 Meltdown
So in March the company revealed their future plan to include Gen3 into Idol Project, which means they get 3D models and do live performances (note that Reina revealed this information, while the others said it's under NDA and just said future plans).
Gen1&Gen2 were super excited about this but Gen3 hated this. The company and Gen1&Gen2 said they don't really understand why, but I can tell you exactly why Aletta and Peony hated that.
That's why I talked about the dog reveal stream earlier. Remember? Aletta suffers from fear of leaving her house. Coincidentally I have the same fear to some extend and can 100% imagine how Aletta felt here. Hell, I almost quit my job too because my superior asked me to go a on-site training in another city. Luckily I could explain my superior that I feel too uncomfortable about this and he found a solution for me (a certain pandemic made it ALOT easier to do online trainings now too, sometimes I'm just blessed). So what I imagine happened here is that Aletta realized the company wants her to travel somewhere (probably to Japan?) for a live performance and she panicked.
It's somewhat similar for Peony. Peony isn't confident in her skills at all, it's probably a nightmare for her to do a live performance. And as such she panicked as well.
I don't know much what Sava things about that, she might either also have a problem with it to some extend (at least I know she hates hearing her own voice during ASMR so she could never talk during it, but not what her stance is on traveling and performance live), but as I said earlier, I see Sava as the "leader" of this group and seeing Aletta and Peony panick, she felt it's on her to resolve this problem. I also think she had her own agenda to go indie anyway about she got enough followers (someone said in a comment that one Gen3 member got pretty "full of herself" after getting a lot of money in a donathon, this could only have referred to Sava or Aletta and I just don't see Aletta as such a type).
So what think happened here is that Sava made this plan for the whole group to go indie. Aletta would never have to leave her house, Peony would never have to do a live performance and she wouldn't have to give 30% of her earnings to someone else. She is a leader type so she probably doesn't even feel the need for manager anyway.
So I promised to explain what confirmed to me that Sava is the leader of this group earlier right? Well, if you take a look at the four new indie profiles for those four members, you can see that it was Sava who initially linked them all together by quote retweeting. So for me it's highly likely that she is the one driving this, even though Peony and Aletta had the strongest reason to leave.
As I said I don't know much about Miryu, but what I know is that the official statement said "originally not everyone wanted to leave". Miryu is a singer as far as I heard, I don't think she had a particular problem becoming part of Idol Project, might even have been excited for it. But realizing Sava, Aletta and Peony will leave as a group, I assume she really just didn't want to be left behind alone.
Gen3 Refusing To Work
So after Gen3 talked it out themselves, on March 28th, all Gen3 members cancelled their streams. Reina noticed that and immediately got worried, because she still had this sinking feeling of this group feeling isolated. So she contacted them and they said they won't stream until they can talk with management. This was at 3am Japan time where management sits, so it was hard to immediately react to these demands.
Reina tried to talk with them but eventually didn't get any replies anymore.
Finally talking with management they revealed they don't want to be part of Idol Project and that they feel burned out. Management then offered some suggestions such as that they can delay their integration Idol Project and do mental trainings first. They also offered them to go on a hiatus to rest if they feel burned out (certainly it's not the number of streams when some of them actually stream like 2 times a day voluntarily when they only need to do 3 per week, right?). Gen3 at first seemed to be okay with this, but the very next day March 29th, Gen3 declared all four of them decided to leave the company and there's no way to stop them (mind you, their contract requires them to work at least 1 year in the company, so they are actually breaking their contract). They said they will try to make them leaving the company "as easy as possible for the company", but still wanted out of their contract.
Now two things happened here at the same time.
Management wanted to understand each individual talent about this sudden and extreme decision, so they had talks with each each individual member to understand their reasons.
At that time Gen1&Gen2 were now also aware of this and (mainly Reina) tried to talk with Gen3, trying to explain to them how damaging and extreme their decision is and how unreasonable they act.
After several painful days of discussions, Gen3 cited a new reason why they want to leave for sure: They no longer have any trust in the Gen1&Gen2 members (I assume because they called them extremely unreasonable) and see themselves unable to work together with them anymore.
In the end management agreed to an early release from their contract.
Conclusion
And that's about my take on it.
It's pretty tough on ProductionKawaii because if you look at the comments on reddit and the announcement video comments, around 95% of them are people pretty confident now that PK must be a black company and there is no other possible reason why a whole generation would quit at the same time. But if I look at all the facts, I don't think so at all. You could say it's just bad luck. Or you could say the actual mistake the company made is to hire people into an idol company that are not confident they could do live performances. And another mistake they made is that they allowed a group to isolate themselves like that from the rest of the company, apparently talking on a channel that no other generations nor management could watch over. It felt like when Reina started to intervene, it was already too late (and it might also not have been the best that she tried to do this by herself).
Reactions of Gen1&Gen2
Nene cried quite a bit because she helped grow the company and now everyone thinks it's a bad company. She is afraid that people will lose their trust in the company. She also loves her viewers a lot, so she really cannot understand how the Gen3 members could just leave their fans alone like that (though I guess that's no longer an issue as you can easily find their new accounts because FalseEyeD even put them into his news video).
Nami just did the "I just say what I think with no filter" route and straight up tweeted "Please stop joining our company just to decide to leave in a few months". Most people called her extremely hostile and unprofessional, but I actually liked all of her tweets.
Charzu gave a fairly neutral view on the situation in her follow-up stream. She explained most of the things but didn't know about the part what Reina did and also didn't disclose that the "secret future project" was Gen3 being integrated into Idol Project.
Reina clarified the rest of the situation in today's stream since she was the only one in constant contact with Gen3, but didn't reply to any questions or anything. I recommend watching Charzu's stream instead unless you want to know the details on what happened between Reina and Gen3 (but I explained all here now anyway).
Lua mostly just went "The show must go on."
Didn't really follow Isla on it.
Shee just mostly tried to ignore it because she had a 48h Birthday Donothon just a day later and didn't want to ruin the mood.
PS: Sorry the post is too long for proofreading lol.