Now that M1 Macs are out there, is there any more information of how Rosetta 2 works? Does it produce a translated app? If it does, does that mean that translated app will thereafter run without Rosetta 2? So that when Rosetta 2 is no longer included in MacOS that translated app will still run?
A few of things:
1. Rosetta 2 was detailed completely at WWDC20. Nothing new about it has surfaced other than performance benchmarks on M1 Macs.
2. Rosetta 2 does not modify the application binary itself. I'm not 100% sure as to whether the translation is stored somewhere else if it is translated at install time, but it IS part of the environment (such that Apple removing Rosetta 2 as they did with its PowerPC-to-Intel predecessor will mean that your Intel app won't be able to load).
3. While Apple did remove the original Rosetta some five and a half years after the first Intel Macs shipped, it's not guaranteed that they'll do the same as soon. They'll probably still be supporting Intel Macs in five years from now (meaning that we have even longer with Rosetta 2). Those buying the first Apple Silicon Macs will likely be considering replacements before that happens.
4. If you're worried about Rosetta 2 going away, I'd give thought to an Apple Silicon native virtual machine solution (of which Parallels and VMware have already announced plans to produce and sell) and/or dual-booting your Mac with a version of macOS that has Rosetta 2 still (down the road when it becomes more obvious that Apple is going to remove Rosetta 2 from a future macOS release).
5. Better answers to your questions exist here: https://developer.apple.com/documentation/apple_silicon/about_the_rosetta_translation_environment