But the 2018 Mini will do full height 5K (5120x2880) with the LG 5K Display?
My guess is that whatever Apple/Intel did to make the above possible was a special purpose kludge and unfortunately wasn't generalized to other unusually wide resolutions like OP's.
It's not special purpose.
Displays can specify multiple tiles in their EDID. Many displays like the LG UltraFine 5K (5K60Hz), Apple Pro Display XDR (6K60Hz), LG 5K2K (5120x2160 60Hz), Acer XV273K (4K144Hz), Dell UP2715K (5K60Hz), Dell UP3218K (8K60Hz), and others specify two tiles - one for the left half of the display and one for the right half of the display. The LG UltraFine 5K uses two DisplayPort 1.2 (HBR2) 2560x2880@60Hz tiles. Each tile is a separate DisplayPort signal. Each DisplayPort signal has a separate EDID that specifies what tile it is for. Since 2560 is less than 4K, it works with the Intel graphics of the MacMini8,1. Use the AGDCDiagnose to see the real EDID for each DisplayPort signal. Utilities like SwitchResX only show a fake EDID for tiled displays (it's a representation of what a single connection EDID might look like - no tile info included).
For some unknown reason, macOS doesn't support multiple tiles for arbitrary displays. For example, the Acer XV273K and Dell UP3218K are not supported by Apple with any GPU at their max resolution/refresh rate. Apple knows about the UP3218K and have purposefully decided not to support 8K 60Hz mode. In fact, they specifically eliminated single cable 8K 30Hz and half screen width modes 3840x4320 even though they work in macOS.
A Thunderbolt cable can transmit two Thunderbolt DisplayPort streams. A Thunderbolt controller in the computer has two DisplayPort inputs from the GPU and does the DisplayPort to Thunderbolt conversion (Many PCs have Thunderbolt controllers with only one DisplayPort input). A Thunderbolt controller in a Thunderbolt display or Thunderbolt dock can convert the Thunderbolt DisplayPort streams back to DisplayPort.