"Difficult to recover from" was referencing setting all of your accounts back up. I should have also included "lost" and "broken" to make that more obvious. Many hardware (most? all?) passkeys do not allow for backup and restore.
But I do see an issue with stolen hardware passkeys being used for access too if they're a primary factor. With the mitigations you mentioned hopefully holding up.
I imagine the low level form of each model being free indefinitely, possibly ad supported. It's already probably becoming the most consistent "we're pretty sure this is from a human" training data they have.