I'm having a bit of a hard time imagining what kind of payment Google could make under this structure. Do you have something in mind?

I agree that if Google was paying a browser for something other than default search placement, that would likely fall outside the scope of the proposal. But historically, default placement = traffic, and is also the only leverage the browsers have - ie if Google wasn't the default, Google would only get users who explicitly selected it, and if Google knows all of their users are actively selecting them already, they have no reason to pay extra for that traffic.

API access seems like a good alternative way for Google to monetize, but it doesn't solve the problem of providing funding for browsers (except in your case, since you're combining a search engine and browser in one company). Or am I missing something?