I think that's the goal. I think Amazon wants to downsize more, but they know that repeated waves of layoffs look bad to investors. Plus, they want to end remote work. Mandating RTO lets them solve both.
2.5 months also isn't very much time to relocate if necessary. Amazon could easily have given a MUCH longer transition period. It's quite cruel to workers, many of whom have planned their medium/long term around remote work.