So why not just have a password that then unlocks the passkey? I already have a password manager.
Password managers are not relevant, as you don't use a password manager to unlock your phone.
The people behind the takeover don't really give a shit about Yubikey-style tokens (which haven't achieved much market penetration anyway) but they've left them in to make the takeover less blatent.
Since the things stored on the remote server have been called “passwords” for decades, it seems helpful to call the local thing a “PIN” to help more easily distinguish it.
IMO it’s not more silly than calling a hand-held computer a “phone.”