setting remove_default_goals to false has no effect on mobs with the brain property specified.
these mobs will still lose any and all AI that would otherwise control them.
adding any type of functionality to Brain now comes at the inevitable cost of losing all Vanilla AI.

Can you show me your mob configs?

I just tested using the following two mobs- scared keeps all the default cat goals, and scared2 does not, so it seems to be working for me. Tested on 1.19.3

scared:
  type: cat
  brain:
    remove_default_goals: false
    goals:
    - type: panic

scared2:
  type: cat
  brain:
    remove_default_goals: true
    goals:
      - type: panic

I tested it using the following mob:

fairy2:
  inherit: false
  type: bee
  name: §dFairy
  health: 15
  default_drops: false
  drop_xp: 20
  helmet: fairy
  brain:
    remove_default_goals: false
    goals:
      - type: trigger
        trigger: sprinkle
  silent: true
  invisible: true
  triggers:
    sprinkle:
      cast:
        fairydust: 1
        none: 10

I have remove_default_goals on false but despite the fairy being based on a bee it stops flying around. I think this could have to do with random_fly being a new vanilla AI goal that the magic plugin doesnt recognize yet?

is there actually any kind of documentation on how the Brain AI in magic plugin works in general? how it executes the configuration etc? because i have found nothing about it anywhere apart from in a few example mobs

No, there isn't really any documentation.

Can you trying hitting your fairy with the debugger spell to see it's goals? (This is a spell on the Wolf staff if you have it)

The goal type shouldn't matter for remove vs don't remove, it's just clearing the whole list (or not).

That said, usually "trigger" would be placed inside of some other goal, (like attack) so that the trigger fires when they attack. It's possible that having that goal by itself is making the mob stuck in that goal, since it's always valid. Just theorizing there, though- the debugger should tell you a lot.

Are you on 1.19.3?

I did have to change something related to removing default goals .. but I thought if anything it would've broken the ability to remove them, not the other way around.

I've tried setting the only brain goal to random_fly, with a trigger as its subgoal and though the fairy then flies, it does not actually seem to activate the trigger at any point.
Apologies for taking so long to respond to this, I've been stuck without wifi for 2 weeks.

Casting Debugger on the fairy does list a set of vanilla goals this way however, but no mention of the trigger this way,

Though I'm noticing now the priority might have been the issue, if i set the priority for the trigger to be very low (high number) it seems to finally be capable of using both.

In conclusion, I think my issue was setting the priority for a trigger higher than the Vanilla priority of moving around