Many password managers use a biometric factor to sign in
The only thing this does is replace the authentication mechanism used to unlock the vault, instead of using your master password (something you know), it uses some biometric factor (something you are), although it uses your biometric data, it’s still a single factor of authentication
This basically moves the MFA aspect to one service (your password manager) instead of having each service do their own thing
I am not sure I understood you here. What do you mean by “instead of having each service do their own thing”? Each website using their own method of delivering OTPs?
It also comes with the benefits of password managers - each password can be unique, high entropy, and locked behind MFA.
I am not discrediting password managers, they have their uses, as you mention you can have unique, high entropy password on a per service basis. The only thing I am against is the password managers themselves also doubling as OTPs generators (take a look at Bitwarden Authenticator which kinda defeats the purpose of OTPs. From the perspective of OTPs it makes much more sense to use a separate application (Like Google Authenticator or Aegis Authenticator), preferably on a separate device, to generate the OTPs.