Even for disks which have self-erased due to entropy, high temperature storage, or poor chemistry resistance to self-demagnetization, these disks are not necessarily defective.
If the magnetic coating has not itself degraded or detached from the plastic, then a self-erased disk can still be used again by low-level reformatting of the entire disk, which lays down new magnetic patterns that defines new data boundaries for tracks and sectors.
(Due to differences in head width and signal strength for low and high density drives, a full erasure with a powerful "bulk erasure" magnet is preferred before low-level reformatting to remove any such old patterns.)
This "refreshing" of the magnetic domains was a feature of an old PC DOS hard drive maintenance software for early MFM/RLL/IDE hard drives, called SpinRite by Steve Gibson. It could read weak sectors, attempt statistical recovery through multiple rereading, and then rewrite each sector to refresh the magnetic patterns.
EDIT: I should mention that really old hard drives used stepper motors to position the read/write heads. A stepper always turns a precise number of degrees for each step, which would be used to position the heads for each track. But due to the loose mechanical nature of these hard drives, there was some "slop" in the head positioning. Taking an old hard drive and tipping it 90 degrees on its side could lead to read/write errors unless it was low-level formatted for that new physical orientation.
Also external physical impacts could cause the heads to "skip" to a new location, which the stepper can not detect and then leads to the drive being confused about where it is reading or writing. If this track-skipping occurs during a write, it can lead to catastrophic data corruption.
An improvement over this was the use of optical encoders and the voice-coil servo positioner. There was a clear glass or plastic band with tiny black stripes printed on it, attached to the head positioning arm, and passing over a light sensor.
If the drive head were to be struck and head misalignment occurred, it would immediately detect the misalignment due to the motion of the optical encoder, then stop whatever it was doing and reposition the heads back over the correct track again.
This worked well, but there is a limit on how precise the optical encoder can be, as tracks became ever smaller and smaller as capacity increased. These drives could also still be low-level formatted due to the external optical track positioning sensor.
At some point there was a transition to a new way of positioning the heads, using special magnetic markers read by the heads to tell them exactly where they are now on the platters. These position markers are printed onto the platters at the factory using special external equipment, and it is not possible to reconstruct the markers once the drive has left the factory. This positioning method is used by all modern hard drives.
Early drives using this method would dedicate an entire platter surface to the servo data, but for modern drives, the permanent servo positioning data is mixed in among the regular read-write areas of each platter, and the drive electronics make sure to never overwrite that servo data.
At this point it became impossible to do true low-level formatting because if the markers are removed, the drive has no idea where anything is on the platters and it becomes useless.
Also, this is why modern hard drives can not be "degaussed" using a powerful external magnetizer, as this removes the head-positioning servo data and the drive can no longer find where tracks are located.