When the thumbs are already generated and exists on the server it is possible to view all thumbs at once.
It is only the inital attempt to get the thumbs, because the server generates thumbs on request of the real image, not when the html is embedded.
The number of fresh thumbs is limited to avoid overload of the server, in that case the 429 is shown.

It appears for me now that all thumbs are generated and shown.

So it is possible to generate html with that count of images and it can work to show all thumbs to the user.

But I see nothing to fix here, because checking if a thumb exists or not and having another page for that case could be expensiver as a reload by the user.

Are thumbnails not created and cached upon image upload?

In T324594#8450630, @RPI2026F1 wrote:

Are thumbnails not created and cached upon image upload?

No, no pre-generation of thumbs on wmf wikis, some wmf doc at https://wikitech.wikimedia.org/wiki/Media_storage#Thumbnail_handling
Inside MediaWiki it is called "transformVia404", see https://www.mediawiki.org/wiki/Manual:Thumb.php or https://www.mediawiki.org/wiki/Manual:$wgGenerateThumbnailOnParse

This is likely the same as T311004: HTTP 429 returned when rendering thumbnails for grayscale TIFF files

Actually.. no it's just a cache stampede I guess..