Hi @skip hofmann ,
"They work only after a password has been entered" - I believe this just means that they won't be able to use a passwordless experience where MFA is presented before entering a password.
"They don’t serve as MFA for step-up authentication in other key scenarios" - Step-up authentication ensures that users can access some resources with one set of credentials but will prompt them for more credentials when they request access to sensitive resources. For example, a user logs onto a site with a user name and password, and if they then try to access a part of the site which requires a higher level of verification we can trigger via code MFA. We don't want the user to have to enter username and password again but just respond to the MFA request. Once the client has responded to the MFA request they can access that side of the website.
"They don’t integrate with end user or administrative credential management functions" - for example, an application providing user credentials directly to Azure AD.
This is how I read it, at least. I'm going to try to loop in the author of that article though to see if he can comment and provide further clarity.