"Embodiment" here seems to mean "having a body," i.e. being able to perform motor tasks in the external world (as opposed to the way it's used in "Embodiment and the Inner Life" [1]).
In that case, I don't think embodiment could ever be considered a necessary condition for AGI. But AGI would need to be able to learn motor tasks if given a body (in order to be called "general").
A deeper question, and one I don't see enough discussion of, is whether a certain kind of embodiment is necessary for AGI to "feel something." I don't think this question is definitively answerable, but it's super important. Can a CPU experience qualia? Or do you need something more "meaty" and analog? Does the material matter at all, or is consciousness (in the hard-problem sense) just a pattern of information?
An even more interesting and relevant question might be - is "feeling" (i.e. having qualia) a necessary condition for AGI?