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At this point, I should stop questioning how often this kind of post comes up, even though I'm probably taking the bait by posting anyway.
With that being said, it seems that recent news articles and the synopsis of the plot itself seem to hint that this title in particular is actually connected to the SD Gundam G Generation series in some way, which would explain a lot about why Gundam Latreia looks and acts much like a new entry in the Phoenix Gundam lineage...
The series started in the 1980s on the SNES. Back then Bandai charged a premium price to license full sized depictions of MS. A company named Banpresto had the loophole idea of getting around this by redrawing the various MS into a "Chibi" (or as it came to be known Super Deformed) art style. Since then Bandai stopped the premium charge to depict full scale units but the SD Gundam franchise was popular enough that it and the art style stuck around.
Same answer as why are there chibi artstyle of anything
SD Gundam originated from a contributed illustration of a junior student from Nagoya by the name of Koji Yokoi to the "Model News" magazine that Bandai was issuing in the 1980s. The illustration is of a Gundam but with an unusual proportion where the overall height of the Gundam is equal to twice that of its head. This illustration interested the chief editor and led to Koji Yokoi serializing SD Gundam in 4 frame comics in "Model News".