But I believe it would be harder for our team to detect and respond to failures in the event handler functions if they were placed there because it seems unclear how we could use our existing systems and practices to do that.

Okay I think this is the issue, handler functions are not "supposed" to fail, they are supposed to trigger Tasks, these can fail.
e.g.:
Model Tag Trigger -> handler function creates a Task -> Task does something, like build container, trigger CI/CD etc -> Task fails/complete
This means for every trigger "fired" you have a Task that logs the entire execution of that trigger instance.

Another way of doing that is to use the Model Trigger to signal an event somewhere else like CI/CD or Jenkins etc.
wdyt?