Passkey is some sort of specific unique key to a device allowing to use a pin on a device instead of the password. But which won’t work on another device.
Now I don’t know if that key can be stolen or not, or if it’s really more secure or not, as people have really unsecure pins.
You should really read up on multi-factor authentication and Web-Authn.
Your problem seems more that you don’t trust Google to store your private keys in their cloud.
And that’s fine. You don’t have to do that. But don’t be confused to think that’s the only option. You can buy a yubikey or a Trezor model T if you prefer.
Passkeys are just a marketing term for Web-Authn. When you use asymmetric keys for other purposes, it’s not passkeys.
I missed the part where I said I don’t trust Google. You seemed to have ignored everything of substance in my response, namely putting a password on the passkey doesn’t remove passwords and the extension of things like FIDO2 beyond web auth.