Considering the large amounts of money Google pays Apple to be the default search engine we are talking about one hell of a loss leader.
They also have app store search. So odds of it being ad free are zero.
If you mean replace any relevant search results for 'Android' with 'iPhone 12' and/or 'iOS 14', then yeah, that would be pretty egregious. However, I can't see that actually happening for a couple of reasons. 1) it would be so obvious it was happening that there's no denying it, 2) it would be so damaging that it would be a service killer as it's all anyone would talk about and never trust it
Also assumes the DOJ/ court systems/ legislation isn't going to block this kind of deal regardless.
(The press has been talking about an Apple search engine on and off for 5 years so I'm skeptical).