Is this related in any way to Core ML model encryption (https://developer.apple.com/documentation/coreml/encrypting-...)? I find that feature a little bizarre because Apple has historically avoided providing any kind of DRM solution for app asset protection.
Nope. This is a separate system. It’s not even abstracted for any asset, it is specifically only for these overrides. The decryption is done in the ModelCatalog private framework.