Yep. This is weight-space learning with LLMs. The authors even got Schmidhuber'd about it on X:

https://x.com/SchmidhuberAI/status/2117446822855888956

And btw it's not RSI:

a) There is no evidence that a model can weight-train a larger, more powerful model.

b) There is direct evidenct that a model cannot weight-train new capabilities to another model (see section "Additional experiment" also cited by OP, where they fail to improve Gemma 3 270M which doesn't loop).

No RSI without those things.