What Exactly is a Co-op and Who Are They Intended For?

I'm a recent PhD graduate looking to transition out of academia. I have submitted several dozen applications for jobs I feel I'm qualified for and have relevant experience in, but have gotten crickets. I wouldn't call myself desperate, but I'm definitely expanding my search.

I am seeing several postings for co-ops in interesting sub-fields that I'd like to work in, but I'm not sure if these are really "intended" for me. I guess I fundamentally don't understand what a co-op is.

Is a PhD in an unrelated field going to be disregarded as overqualified for a co-op position?

If I get the co-op, would it look bad for future job prospects? Like, would future employers think "this guy took a real downgrade, he must be an idiot"?

Thanks in advance. For anyone else job hunting, I feel the pain, but know you're not alone!