Is making pokemons fight Animal Cruelty?

I can't answer because it's actually deeper than just yes or no. It depends totally on the point of view and where you're coming from.

Yes. It was literally the moral of the first movie.

Then Mewtwo realized he had accidentally ended one of the biggest cash cow franchises of all times and erased everyone's memory.

ok ok i will be come a vegiterin and i will not fight pokemon for badges how ever if u walk up to me and say lets fight ill pull out my balls quick style

It's a pretty safe bet that any veteran battler pokemon has severe brain damage.

Are you using real world's logic in the (almost) perfect world of Pokemon? Leaving aside the criminal organizations, you have free healthcare, nigh infinite water supply (eitheer water gun or rain dance), the world's enough safe if you send a 10yo kid to adventures around the world.
I don't know about you, but I wouldn't mind living in that world having pokewaifus and Gardevoir as a wife implying that pokephilia is legal