What really qualifies as going down a rabbit hole in that instance is if you devour cat videos because they hold the key to the universe that They don’t want you to know.
The usage I’m most familiar with revolves around becoming ever more deeply enmeshed in illogic and fantasy (with a strong element of conspiracy theory).
Not everyone defines it the same way, of course. I remember an Amazon book reviewer who embraced an especially nutty form of woo, describing approvingly how the more she read, the further she went down the rabbit hole.
I disagree with this, because I think that the actual definition of the term rabbit hole means that you end up somewhere other than you started - specifically that you have followed a path or chain of thought and end up somewhere unexpected and strange that doesn’t really follow from or relate to where you started or where you wanted to be. So just doing the same thing over and over in an addictive manner isn’t this.
I feel that this describes both perspectives described in the OP, though the fact that the wife’s definition starts with them in an alternate reality means that it’s only describing half the trip - the full descent of a Trumper starts with them being largely reasonable, somewhat decent people, who make a series of decisions that each seems reasonable within the context of their experience at the time (listen to the news, listen more to the enjoyable Fox news, listen only to Fox news) but ends with them being immoral sociopaths that entirely support atrocities of all kinds.
The notion that going down the rabbit hole makes you crazy isn’t really accurate; it’s more that where you end up is crazy. After all Alice didn’t end up crazy at the end of her trip. Going down the rabbit hole only makes you crazy if the rabbit hole you’re going down involves how you think, not just where you are or what you’re looking at.
To me, it means entering into a situation where you don’t know what to expect, what the rules are, and so on. My brother described the aftermath of his cancer diagnosis with that phrase. What if this turned out to be fatal? Would his family be taken care of? What if there’s a difficult decision to be made about surgery? How long does he have?
Everything turned out ok for him, by the way. I don’t think it has to be a bad situation—but I wouldn’t use it to describe, say, winning the lottery.
I agree with those who contend that they’re not two separate usages. The OP’s wife is using it in a narrower context, but it’s not particularly far removed from the being distracted by non-political tangents usage.