I’m not sure there’s much more to it; I think you’re reading too far into it. It shows the power of their model and possible applications towards privacy.
It’s not a stance that that hypothetical camera is actually great for privacy.
The positions of the masked pixels are not stored in the resulting data -- it's not like they are just making some pixels black. The channel information is actually removed from the buffer entirely, and then inference is performed on that buffer:
> The camera stores the remaining unmasked pixel channels in an array without retaining the coordinates of pixel channels on the image sensor. In this scenario, an ad- versary could not obtain a faithful reconstruction of the in- put image. Even if the adversary could guess pixel channel locations, the low resolution of captured data prevents the adversary from recovering a high-fidelity image
Also:
> Their "partially-masked image" just looks like a noisy image, not a redacted one
The caption for the figure (assuming you're talking about figure 4) makes it clear that the figure is illustrative, since it includes the positions of the masked pixels. The pixel positions would not be present in the actual data that comes from this hypothetical camera. So what the figure "looks like" is irrelevant -- its purely illustrative.