Is the Dart VM still used?
Short answer: yes, Dart VM is still being used when you build your mobile app.
Now longer answer: Dart VM has two different operation modes a JIT one and an AOT one.
In the JIT mode Dart VM is capable of dynamically loading Dart source, parsing it and compiling it to native machine code on the fly to execute it. This mode is used when you develop your app and provides features such as debugging, hot reload, etc.
In the AOT mode Dart VM does not support dynamic loading/parsing/compilation of Dart source code. It only supports loading and executing precompiled machine code. However even precompiled machine code still needs VM to execute, because VM provides runtime system which contains garbage collector, various native methods needed for dart:*
libraries to function, runtime type information, dynamic method lookup, etc. This mode is used in your deployed app.
Where does precompiled machine code for the AOT mode comes from? This code is generated by (a special mode of the) VM from your Flutter application when you build your app in the release mode.
You can read more about how Dart VM executes Dart code here.
When the Dart VM is used in release mode, it is not really a VM (virtual machine) in the traditional sense of a virtual computer processor implemented in software, which has its own machine language that is different from the hardware's machine language.
This is what causes the confusion in the original question. In release mode, the Dart VM is basically a runtime library (not much different than runtime libraries required by all high level languages).