As far as I understand it, nothing "clocks down"; rather, frames are delayed as required to achieve the frame rate desired (or reachable, in the case of gaming) by the source, down to 1 Hz.
So, yes, fixed 120 Hz and 120 Hz with VRR and without any skipped frames might well be the same mode to a GPU, but it also might be a different one, requiring a mode switch. I don't know how Apple has implemented it.
But in any case, for the bug at hand it's irrelevant: Apple's ProMotion uses a refresh rate of 120 Hz, so switching between that and 60 Hz is definitely a mode switch.