This is all interesting. I am actively thinking of getting an M1 iMac, but not ordering yet as my Apple store has not got one to see. I have a Macbook and use a Sandisk 550MB/s SSD for Time Machine. It works so much faster than a spinning disc portable HD. I also have another Sandisk 550MB/s for current photos and I am very pleased with it using it on both the PC and Mac with LR, and my wife has one for her data.
If I get an M1 iMac I will get one with 16GB memory and 1TB internal SSD. Data will be held on a 2TB external SSD. I would then want Time Machine to use an SSD for backing up both internal and external SSDs in one session. This means I would probably use a 4TB SSD as neither internal nor external SSD will be full; I like to keep spare space. Archiving of photos will probably continue on my existing spinning discs. What I do with my PC is to backup alternately on external HDs. I am wondering if I need 2 SSDs for Time machine alternate backups on a new M1 iMac. Decisions, decisions, but it is good to know the USB 4 limitations on the M1 iMac.
Best wishes,
Jonathan