If the hardware wallet uses their own standard or there is no way to know how to generate the private key, then there is no difference between them and closed source wallets, and therefore your money is at risk and it is better to avoid them.
This applies to some altcoins that do not have an active developing.
for those altcoins keeping in in HW or CEX is the same.
Are you talking about a possibility in which the software and blockchain is so badly done that it becomes impossible to make transactions or something else? If that is the case, then yeah, a non-functional shitcoin is equally non-functional no matter who holds the keys.
If you are talking about censorship, freezing of addresses, and reversibility of transactions, things are a bit different. These things could be initiated by the issuers and developers if your coins are on a CEX or in your hardware wallet. The additional risks with CEXs are that they can freeze, lose, steal, or gamble away your crypto. Or you fail their internal KYC or AML procedures.