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Is Flutter open source?

Yeah it is under a BSD license:

It's open source the way Chrome is open source: the source is there, but the development is ~100% by Google

Google Chrome is not open source, Chromium is.

People keep pointing this out as if this made a grain of difference.

Not 100%, at least 30% of PRs are done by outside Google contributors.

How relevant are those PRs to the actual development of the product?

That is, fixing minor bugs or translation strings vs adding new web APIs etc.?