What Does The Wine Industry Do with its Screw Ups?

In the process of researching the current trend of aging in barrels used for spirits, I came across, what I thought, was a good point. This person wrote that aging in former spirit barrels was a clever way to mask faults in a wine. And you get to charge the customer a premium for the privilege. It got me thinking: How, in fact, does the wine industry monetize its mistakes? Are there brokers who will buy a winery's screwed up batch and release it to less discerning markets? Can you distill it into something useful or more valuable? Or does every batch of wine just always turn out perfect, somehow? ;->

I'm WSET Level 3 Certified, but I've never worked in the industry. So while I have an academic understanding of the process, I've never made, bought, or sold wine professionally. And this seems like a subject you'd learn about on the job.

Thanks in advance!