Earlier quoted context omitted.
Hyperbole. Being a separate device, as you said, means the phones would still work independent of Apple. The Chinese government would block updates and sales, hencecustomers would blame them, not Apple, because Apple was incentivized with customers instead of the government moving forward.
Basically everyone with an iPhone uses an Apple ID. It is certainly not hyperbole that the devices usability would be very severely impacted without access to Apple's servers.
It is not "bricking phones" as you said. As much as you don't like this fact, Apple had a choice and decided to put the Chinese government before it's users.