The iMac is an all-in-one computer. It’s not uncommon for all-in-one computers to come with an HDMI input, so you can... ya know... use the monitor you bought as a monitor and not have it permanently tied to the computer it was sold with.
It is not all that uncommon for mainstream, plain monitors to have more than one video input plug/jack. Apple's don't. Haven't for decades. Even back to Cinema display era before the turn of the century :
en.wikipedia.org
One and only one input plug. Thunderbolt docking station "monitors". One and only one video input.
Apple just hasn't done "one monitor multiple computers" in over two decades. Why would they be doing it going forward into the future. Very likely Apple just doesn't see a huge latent market out there for multiple input monitors where feature is a super critical factor.
The very major issue at this point is that Thunderbolt is a "video out". Apple would have to injected some substantive , proprietary gyrations to get Thunderbolt port to optionally switch to an "input" port. Yes, in a peripheral it can be an input port , but to get things to go the other way would adding another switch ( and/or a substantively more complicated switch to ) .
When Thunderbolt moved from v2 (and 1) to v3 it also switched from mini-DisplayPort to USB Type C. On the mini-DP socket there was only two signaling subtypes being set there: DisplayPort and Thunderbolt. For Mac TB v3 there are at least 3 ; USB , DisplayPort , and Thunderbolt. The other issue is going from 1-2 ports that switch both ways to 4 ports. The latter is an even more complicated switching set up for a mode that relatively very low utilization. Long term the iMac is probably going to 4 (or more) TB ports (or minimally USB4 ones).
The recent iMacs have generally have been on a track where the LCD panel connection is switchless ( as in iMac not use the iGPU much at all.) If the Apple Silicon iMacs 'flip the script' there and go iGPU only, they still be in the no switch to plug into status.
The other issue is that with Thunderbolt, Apple has pushed the concept that it doesn't matter which "video out" TB port you use. The video comes out. Even if they put in a Rube Goldberg solution layered on TB , for target display mode that port would have to be 'different' from the others. Apple isn't likely to that and more than the simpler "input only" port which they don't do at all on "mentor" systems.
Apple could "re-think" their adversity to multiple video input ports. With no 'raw' Windows ( or other OS) boot support there are a subset of users who are going to use two boxes to split up their workloads. Once have two boxes and limited desktop space having a single monitor that switches between the two becomes more common. Apple would get incrementally less "hate" if some folks could plug their gaming PC into iMac to single track using both systems. Enough of drop to ge them to drop their long held preferences..... i wouldn't hold my breath on that.
Target Disk Mode is going away also with Apple Silicon Macs.
"...Apple is also replacing Target Disk Mode, which is used to transfer data between two Macs, with what's called Mac Sharing Mode. Mac Sharing Mode turns the system into an SMB file sharing server, providing another Mac with file-level access to user data. User authentication is required to access the service. ..."
Apple Silicon Macs will introduce a new system for accessing macOS recovery and security options at startup, Apple explained at a WWDC session on...
www.macrumors.com
Looks like Target < fill in the blank> modes are
all getting tossed. Apple Silicon Macs are going to be more focused on being better Macs ( not a Mac trying to also be something else ). So seems like it more so comes down to whether Apple is going to cut an 'extra' hole in the iMac enclosure shell.