I've used this command countless times without issues this bad with worse scans than this one, but I've never had it draw random lines in space. I wasn't trying to do multiple lines at once. I tried a lot of different parameters and they all gave bizarre results (I just uploaded 2)
I would start here for assistance on this. It doesn't look like your procedures are correct based on the screenshots.
https://community.trimble.com/blogs/hannah-poon/2021/08/05/how-to-extract-multiple-lines-at-the-same-time
https://drive.google.com/a/trimble.com/uc?authuser=0&id=1TasZZle5nEzBp3PwPxuTEptHqpyOwHDB&export=download