Earlier quoted context omitted.
Correct, but the destination ISP chain (and of course the destination service itself) can equally see the traffic coming from the VPN, and if you have packet metadata (precise timing and packet sizes) from two sources on either side of the VPN, it is trivial to correlate those two streams.
Note that Mullvad's WireGuard settings offer a "multihop" feature, meaning the VPN destination your ISP sees and the VPN endpoint the end service sees differ.
/question from ignorance