That said, it's a shame there is a poor pixel response time. I don't understand this technology hugely but the reviewer in that video suggests it could be fixed by Apple overdriving the screen—and I suspect that would impact battery life and possibly heat (which is already an issue with these displays, because they're known to shutdown if on full brightness in a warm environment).
Overdriving the pixels just means pushing more voltage to them. This can improve pixel response times but can also introduce overshoot (color/luminosity of a pixel goes beyond the intended value before settling down to the correct value) which can be visible as negative ghosting - bright trails instead of dark trails. It should not have any significant effect on power use or how hot it gets.
Most desktop displays offer a number of overdrive settings where there is usually a sweet spot that performs best for the particular panel - achieving both good response times and no or negligible overshoot.
Most TVs instead offer multiple modes where some favor image processing over response time and input lag while others like game modes favor low input lag and response time but disable some processing features to speed things up.
It would be good for Apple to offer something like this too. For example they could have a "content creator mode" that favors image accuracy above all and then a "normal" mode that is snappier for regular desktop use, watching videos etc. Or even separate modes for graphics designers (favor color accuracy for static images) and video editors (favor motion performance).
I have no idea how Apple can consider it acceptable to have such absolutely terrible response times on their laptop displays. For perspective, the 5K Apple Studio Display is much faster and even that is slightly slower than is required for 60 Hz, causing extra motion blur. Apple's Pro Motion Macbook Pros cannot keep up in pixel response times for 60 Hz let alone 120 Hz.
Either the issue is that Apple did not bother dealing with pixel response time at all or their mini-LED backlight is abysmally slow too so the pixel response time is tuned to work with that. I really hope they perform better for the M2 Macbook Pros as this to me would be an easy area where they could improve the performance.
Using adaptive sync for variable refresh rate is at most a battery saving feature on Macbook Pros as the display can drop to very low refresh rate when the image is static and then immediately ramp back up to 60-120 Hz in motion.