In short, to answer OP's original question: Yes, it is theoretically possible for your wallet to generate an already used address, but our sun will have engulfed the Earth long before that ever happens.
I like this explanation, theoretically possible, but not possible during human existence.
How about the 4 extra bits added during checksum, is this not providing any security, like adding more impossibilities for the already existing seed phrase to again be generated by another users which is refered by some people as collision? I have noticed what people concentrate more on is the 128 bits of entropy.