The XSX has the clear TFLOPs advantage. The PS5 SSD's speed can't completely negate it. However what the discussion is missing is exactly how the XSX TFLOPs advantage will actually improve games vs what the SSD advantage will do for the PS5. I'll avoid the SSD hotbed right now and speak only about the TFLOPs.
The PS5 has an 18% TFLOP deficit to the XSX. It's real, but it is only half the difference between the launch PS4 and XB1. The key here is that the easiest way to for the PS5 to make up that deficit is to drop the resolution when a game's image processing gets demanding. However, resolution is hitting major diminishing returns, and an 18% resolution reduction from a 4K target will hardly be noticeable.
Putting it another way. An 1800p image with good image sharpening is pretty close to 4K. That's especially true without a side-by-side comparison and while actually playing a game. Now, the PS5's 18% reduction in resolution needed to meet the equivalent processing power of the XSX is still
21% better than that already pretty good 1800p. Practically speaking, outside of a zoomed in slow motion Digital Foundry type image examination, it's a complete non-issue.
...Ok I lied. I will speak quickly about the PS5's SSD advantage because this part of the developer's comment irked me.
It’s[SSD] also nowhere near GDDR6 levels so it can’t reliably be used as virtual memory.
I've heard some form of that many times, and it completely misses the point. The SSD won't be used as a stand-in replacement for GDDR6. SSD data only needs to be read once for the many many times it will be accessed in RAM. For example, the CPU/GPU won't repeatedly read SSD data, do an add and/or multiply, and immediately write it back to the SSD like it would GDDR6.
No, the purpose of the super fast SSD is to act as a force multiplier for the 16 GB of GDDR6 already in use. By significantly reducing the latency and increasing bandwidth, the PS5's SSD reduces the penalty taken for needing data not already loaded in RAM. That means much less of RAM has to be wasted as a cache for the hard drive or SSD. That effectively gives you more RAM to work with. Cerny used the example that games currently have to have all the data they will need for the next 30 seconds fully loaded in RAM. In contrast with the PS5's SSD, that drops to only needing the next 1 second's worth of data in RAM. That frees up a whole lot of RAM for processing what is immediately around the player at that moment.
It's like a car being able to drive farther because it is more fuel efficient, and not because it has a bigger gas tank. The end result is the same, but no one thinks the parts that make the car more fuel efficient burn like gasoline. Same is true of the SSD. It has the same result of increasing RAM, but it itself is not used just like RAM.