From what I've understood of this - it's transpiling the x86 code to ARM on the fly. I honestly would have thought it wasn't possible but hearing that they're doing it - it will be a monumental effort, but very feasible. The best part is that once they've gotten CRT and cdecl instructions working - actual application support won't be far behind. The biggest challenge will likely be inserting memory barriers correctly - a spinlock implemented in x86 assembly is highly unlikely to work correctly without a lot of effort to recognize and transpile that specific structure as a whole.
I thought FAT binaries don't work like that - they included multiple instruction sets with a header pointing to the sections (68k, PPC, and x86)
Rosetta to the best of my understanding did something similar - but relied on some custom microcode support that isn't rooted in ARM instructions. Do you have a link that explains a bit more in depth on how they did that?
I mentioned this on a related article already but it'd be interesting to see an ARM Steamdeck after seeing the performance and battery life of the Apple desktop chips. I think gaming will eventually go the way of ARM.