100C isn't insane in the PC world either. Common knowledge like this is often generated by internet echo chambers, and isn't necessarily real.
As an example, Intel's own Alder Lake i9 processors are rated to run at 100C. Look at the "Tjunction" spec:
Intel® Core™ i9-12900HK Processor (24M Cache, up to 5.00 GHz) quick reference guide including specifications, features, pricing, compatibility, design documentation, ordering codes, spec codes and more.
ark.intel.com
Most of the noise about 100C being awful comes from PC overclocking enthusiasts. Few of them know as much about chips as they think they do, but they do observe things. One is that if you want to overclock a chip nominally rated to run at 100C, you might have to cool it to 80C or lower to make it work reliably. By the time the echo chamber is done with it, this observable true fact gets transmogrified into "OMG 100C is SUPER DANGEROUS!!!!".
But the real truth here is something far less scary: there are well known semiconductor physics phenomena which reduce the speed of transistors as they get hotter. Chip designers try to assure adequate timing safety margin in worst-case conditions, so whatever the top end of the temperature range is, that's where timing margins are worst. Now an overclocker comes along and wants to run the chip faster; they're blowing through whatever timing (note: not damage) margin was built into the chip and must do something about it or the OC won't be stable. The two easiest knobs for an overclocker to turn are reducing operating temperature below the manufacturer's spec, and increasing voltage above spec.
None of that applies to a M1 MacBook. Apple doesn't publish M1 chip specs, so technically we don't
know if 100C is out of spec, but it's really common for chips like M1 to have a max operating temp spec somewhere in the 95C to 105C region. Combine that with the fact that Apple clearly designed the cooling system to allow the chips to get that hot, and it seems likely that it's in spec.