Unless it was called something else, I tend to refer to their world as Earth, but I'm basing this solely on circumstantial text that I remember the word Earth being capitalized as a proper noun whenever characters talk about harnessing the power of Earth from characters like Tomamo or Gnome or how Himiko is referenced as an Earth Mother.
The simple answer is that the developers wanted to include every enemy from the OG trilogy when wrapping up Paradox.
How it fits into the story, impacts the setting, or whatever other potential plot bomb would arise from hamfisting all the things they did into Paradox were secondary to just having them be a part of the finale. The presence of the Collab Scenario in Part 2 should have been the biggest giveaway that the worldbuilding lies upon a foundation of sand, anything you try to build out of it will quickly collapse in on itself.
The worldbuilding imploded upon itself the moment Nero was introduced.