The iCloud recovery key is a 28-character string, not your iPhone PIN: https://support.apple.com/en-us/HT208072. There is no situation that I can think of where a device PIN is of any use off-device.
Recovery keys were part of iCloud Keychain end-to-end encryption when used without "two-factor authentication", which is now a deprecated setup and can't be used with new iCloud accounts anymore:
Thank you for the links. In my case, I have two-factor _and_ a recovery key set up. The Account Recovery icon on Apple ID says "Your device passcodes can be used to recover end-to-end encrypted data. If you forget your passcodes, you'll need a recovery contact or recovery key."
Are you sure it's either/or? Have you gone through the process, and are you sure the PIN is required off-device, rather than ? If that's the case, I do agree that it's not good.
Also I don't quite understand the threat model where a stronger authentication to iCloud allows for weaker data encryption. Considering Apple is usually pretty spot on with these things, this would definitely stick out.