Having come from a 2011 MBP to a 2020 MBA i3 to a M1 MBA, I can definitely confirm that the webcam on the M1 is significantly better. Seems to let a lot more light in and is much sharper.
To be honest, who wants a 4k/1080p webcam in a machine anyway? You'll only be able to see the persons wrinkles, blemishes and spots in more detail after all!
If you need a higher quality camera for streaming things, you're more than likely going to use an external camera anyway irrespective of what's in the Mac!