Yep, so the SoC RAM might be like an extra, much much bigger, layer of cache RAM. Just like the main RAM at the moment, is in a way, like a layer of cache for the swap space on the SSD. Although, in the case of swap space, if the OS needs swap space on the SSD, then you have a problem, and you need more RAM.
If the Mac Pro M1 Extreme is, as presumed, limited to 256GB on-SoC, but has up to 6TB* of plug in RAM, then this idea of the SoC RAM being a "cache" layer, might actually make sense.
*The Intel Mac Pro has 12 slots of DDR4 with a max of 128GB per slot, thus the 1.5TB limit. The M1 Mac Pro should be DDR5, which currently has up to 512GB DIMMs, so if 12 slots, is 6TB, but could be 6 lots, so 3TB.
I'm not actually sure how much faster SoC RAM is compared to plug-in RAM, though, does anyone know? Surely it is nowhere near the difference between RAM and SSD speeds?