It allows the pairing key to be exfiltrated from the compromised device and an external, attacker controlled device to perform any function the original device could. This includes retrieving the paired devices phone number, answering phone calls, and receiving the audio. They live demo hijacking a whatsapp account using this.
The RACE protocol could be accessed even if the device isn’t in pairing mode. Then once you have a target device’s key you can carry out the attack at anytime, when they’d be unlikely to notice.
No, that doesn't seem to be the case.
> then you can answer my calls if you are next to me, which in the real world is certainly noticeable.
You may not notice if the call was answered automatically and you didn't have your device on you, and the call could be forwarded with acceptable latency so the speech wouldn't be in earshot. Or these days you could use an AI to generate voice and it would sound realistic.
Just because something isn't likely to affect ordinary citizens doesn't mean it isn't possible.