We encountered follwoing scenario while using a custom library: (RF 6.0, Python 3.10.8)
When the initialization of the custom library fails, the test execution is continued until the first keyword provided by that library is used. The result is a rather misleading "No keyword with name 'XY' found.".

Here is a minimal example:
ExampleLib.py:

class ExampleLib:
    ROBOT_LIBRARY_SCOPE = 'SUITE'
    ROBOT_LISTENER_API_VERSION = 3

    def __init__(self):
        # do init stuff
        raise Exception("something bad happened while doing init stuff")

    def sayHello(self):
        return "Hello World"

Example.robot:

*** Settings ***
Library    ExampleLib.py

*** Test Cases ***
Test SayHello
    ${res} =    Set Variable    "This is a String"
    ${res} =    sayHello
    Log To Console    ${res}

Result:

It would be great to have the possibility to stop the test execution from within the custom libraries constructor.