It is a bit of both. The Firestorm cores in the M1 are in fact very high performance. Per clock cycle they beat anything from Intel or AMD, but Zen3 cores from AMD are still faster since they are clocked much higher. But that also means much higher watt usage.
But the kind of superior performance people see when using stuff like Final Cut Pro is of course in large part due to specialized hardware. That is why iPhones are outperforming Mac Intel laptops on tings like video encoding by a large margin, which is seems crazy, but makes sense when you realize they utilize specialized hardware.
With respect to vendor specialized libaries, that has of course always been a reality. Mac, Windows and Linux don't use the same core APIs. But open source developers have usually made libraries such as SDL, Cairo, Qt etc to paper over those differences and allow portable software to be written.
And long before Apple we saw how Nvidia locked people into CUDA until more open standards arrived.