I don't see why it's ridiculous. It serves as a compromise between fully-guaranteed pay, and heavily incentivized pay-bumps each year.
If the Twins' opening argument was, "you haven't had more than 511 PA in a season, how can we guarantee a contract for a whole bunch of years?", escalators would be a response saying "okay, if he plays (say) 150 games in a season, will that be enough to ease your worries?"
Escalators aren't as team-friendly as incentives, but they still represent a form of risk-sharing rather than the team bear all the risk.
Every multi-year player contract, no matter the track record on health, carries significant risk.