Matter is local. Yes but google hubs and speakers refuse to do anything if they are not able to access the internet. What would happen to your "local" stuff in that case?
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Devices are local, this doesn't mean automations are..
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Quite confusing. What is realy local if you can't event turn a light on without the internet. (assuming someone only have google as a controler)... Maybe they would all need a Hubitat matter controler 
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Apple HomePods run all their automations locally too. But yeah, a Hubitat is the superior automation platform.
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This implies a user interracting with the device via a dashboard or app of some sort, this could be local or cloud, a true automation requires a diffferent level of local processing, which could be local, but more than likely will be via cloud on many platforms.
Would using matter on lets say devices attached to the TUYA hubs but blocking the tuya hub from internet access still allow the devices to work from hubitat (or other matter controller)?
I think we've circled 'round to ...wait for it...
"It depends."
Glad we could clear that up for you. 
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I am using hue's matter support (currently in beta) to talk to HomeKit. It works much better than the hue native HomeKit support. I have no way of knowing if/when the hue skill on Alexa will cut over to matter. Amazon chose to use vendor specific skill for matter support, which is odd, since HomeKit doesn't care. I just add accessory, select matter, and pair, and done. I want the same for Hubitat. then my anything that talks matter can talk to hubitat (within reason) without specialized drivers. The Matter protocol matters when it comes to the future of smart homes.
In the case of HomeKit, the automations are local. According to Amazon's Matter development video, their automations would be local too, and that is why Matter will only be supported on their more powerful devices. Thread will only be available on the devices that can also do Zigbee, from what I was watching. I personally think HE is the best matter controller, and HomeKit and Alexa, and other smart speaker / home assistants are better in their role of being assistants -- but Matter is great there, to not have to rely on any one hub/bridge to make things work. Everything speaks directly -- that's what I want to see.
Hopefully Matter can be shoehorned into existing hubs and would love to see thread on the C8. The Matter rollout looks problematic at the moment but as mentioned it's still early.
Wonder how this will all play out with device sharing.. especially curious as to how Hue will deal with their product line and also maybe Apple. It looks like shared devices will only get the baseline/generic capabilities for the most part.
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I've not kept up. The is the C8 due out? With the more or less constant two-figure price of the C7, I am guessing fairly soon.
It depends on your definition of "fairly soon" - I'm sure there is still a ton of work that has to happen on the testing and manufacturing ramp up, distribution etc also still needs FCC approval as well I guess.
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I suspect they are waiting on making it Matter compliant. It may take them some time. I am sure the Hub will be available by the time Matter is really relevant.
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Yeah you see the difficulty the "big" players seem to be having with the initial implementation. Hubitat, Inc might wait on releasing it or just include it down the line with a new hub but suspect development is currently in progress.
Disclaimer: I do not work for Hubitat, Inc or have any inside knowledge, it's just speculation on my part.
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I agree completely.
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I do think there may be an issue that could have HE releasing Matter support sooner than later...at my previous company we referred to "Chooser" and "User" features. Chooser features were related more to customers' purchase decisions, and user features were what customers actually did w/the devices once they took them home. Kind of fantasy "Oh, I could/would do this - how exciting!!" vs. reality "I only really have time or need/want/understand how to do this."
Matter can easily fall more into the chooser category as its promotion heats up across the industry and you see more and more vendors touting it (even if it doesn't really work right yet). HE could look like they aren't current/are missing something if they can't put Matter in their feature list sooner than later.
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The issue right now is negative press. Lots of reports of things not working, frustrating setups etc etc.. Hubitat, Inc could promise Matter support but hold off until the smoke clears.
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I agree and disagree...case in point, I have a friend who has watched my HA activity from a distance for a while. The other day he actually brought up Matter and said he was thinking about getting into HA "now that it's getting better." [eek!] I think there are potentially a lot of people (a lot in HA market terms) who are hearing about Matter via normal "skimming" of press releases disguised as news, and regardless of how good or bad it is they will be making purchase descisions based on it.
And we know how much HE (rightfully) tries to avoid promising things they haven't released yet... 
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