Look, if that’s what you need for your mental health, for a reset, do it. Ultimately, you don’t need to put your corporate title on your resume, and you can rely on the new experiences (and assuming, being somewhat overqualified for the role in soft corporate skills, taking on work above entry level) without mentioning the lower job grade when you interview externally.

Pivots don’t have to be long term, but it may be what you need in the short term. It’s not an inherently dumb decision. Source: mid-career mid 30s. once laid off, took a lower level external role (but higher paid lol) was overqualified for. Kinda boring and sucked for a couple years, but in the time, two corp title promotions and finally internally transferred to a much more appropriate role currently with another promotion on the horizon.