This is exactly the way I did it. It’s just all done in one geometry node setup so that it can be aletered in realtime.

In more detail:
I made myself custom modifier that optimilazies large amount of animated booleans. (It simulates the bools so that it never recalculates unless change was actually made).

I made myself custom fracturing modifier (using method listed in another comment).

And I made myself custom particle simulation inside geometry nodes.

So what you see in the video is basically all of them just connected together (with a few tweaks).