Earlier quoted context omitted.
I'm not saying if the paper is correct or not (since I can't tell), but I don't think your argument really holds. Consider applying it to multiplication: Fundamentally, multiplication need to look at every pair of integer from the two input numbers. It must be O(n^2); N digits looking at N other digits is quadratic. Any sub-quadratic multiplication must hence necessarily lose some information.
Multiplication has some properties like being cumulative. If we assume the sequence has any specific properties then we no longer have a general sequence model.
Attention also has some specific properties.
And sometimes results are just unexpected. Did you know that anything a Turing machine can do in t tome steps, a different Turing machine can do in O(sqrt(t log t)) memory cells? https://news.ycombinator.com/item?id=44055347