> But that doesn't prevent issues due to switching between customers on the same physical core, no?

Yes they are explicit that customers may be time-shared on a physical core ("burstable" instances don't really make sense without that). Most of these attacks aren't known to be possible in that scenario and in any case the mitigations are much easier since flushing sensitive state at group scheduling boundaries is much less costly than permanent dynamic changes to how concurrent SMT threads interact.