Exciting stuff - but I expect all sorts of interesting corner cases for a while. Good idea to do this via a beta.
Admittedly, I need to read deeper into their service mesh proposal, but on the surface I don't understand why they couldn't have worked to integrate with something like Istio?
The idea seems to be they do it all in e-BPF. No kube-proxy, direct routing, now also sidecarless service mesh. Just deploy cilium. Sounds like a win to me.