The overall bandwidth isn't affected much by the distance alone. Latency, yes, in the sense that the signal literally has to travel further, but that difference is miniscule (like 1/10th of a nanosecond) compared to overall DDR access latencies.
Better signal integrity could allow for larger busses, but I don't think this is actually a single 512 bit bus. I think it's multiple channels of smaller busses (32 or 64 bit). There's a big difference from an electrical design perspective (byte lane skew requirements are harder to meet when you have 64 of them). That said, I think multiple channels is better anyway.
The original M1 used LPDDR4 but I think the new ones use some form of DDR5.