How does this undercut apple? This entrenches apple's position as a provider of "verified" devices.

nothing to do with apple per se

with age requirements for use of social media, Meta faces tremendous liability in many countries if they cannot do the verification correctly.

they don't want to do it, nor face the risks, so they'll push it to the OS.

they also know that banning under-16s means a huge market will be gone, so they want an easy-to-bypass OS fix. if their tween market gets around the hardware and OS it's not their problem, but Meta can't it if it's on them.

in other words lets annihilate the free internet and maybe democracy so we can lower our risk profile

Nope. Apple have been enthusiastic in their implementation of it even without it being required in several countries.