I got the same email and I'm also super confused. As long as I can remember, when I checked the box for trade-in as part of the online Pre-order on opening pre-order day, my mail-in device trade-in value was always credited back to the credit card that I used to place the Pre-order for the new device. This was the case for iPhone, Watch, and iPad pre-orders in the past.
This year, it seems to be different for some reason and I'm not sure why. Unless, this email is just wrong and it will be credited back to the credit card within a few days? 🤷♂️
When I have done Apple Trade-Back on Apple devices which were not associated with a new device pre-order, I have gotten a Gift Card for the device trade-in value but that was expected since it was not part of a new device pre-order.
What might be a unique case for me this year was that after the payment for my pre-order was processed, my Apple Card "online" credit card number was apparently stolen by someone who really wanted some "free" Popeye's, postmates, uber eats, and liquor (based on the charges with the stolen number). Anyways.... my Apple Card "online" number had to be changed between the pre-order and the trade-in being received. I'm not sure if this forced the gift card credit instead of credit to Apple Card directly because they had to change my Apple Card number?
I must admit that I really liked getting the credit back onto the credit card as a result of trade-in with the pre-order. I'm not as big of a fan as extending $640 to Apple for them to invest and make more money on until I have to buy another Apple device to get that $640 back.... which likely won't be until the next major product update (iPad/iPhone) which could be 6-12 months gap where that big chunk of change is unusable for me to use or invest.