It wouldn't be the first time a crew errs in calculating their takeoff performance and uses too low a thrust or flap setting. Everyone on that plane is lucky to be alive, as others have died after similar takeoffs.
Yes, the autothrottle commands the thrust as calculated for a Flex take-off. But it's only correct if the input parameters are correct. There was a Sunwing 737 which bent the runway lights at Belfast in 2017 because the pilots had entered the wrong temperature variable:
I thought that on airliners pilots input runway length, altitude and wind strength and direction, and the computer optimized the thrust accordingly?