Does the Pixel Watch 5 GPS correction improve pace during a run?

No. The system works on Google’s servers once your workout uploads, so every number displayed on the watch mid-run comes from the watch alone and stays exactly as you saw it.

Can the corrected track change my recorded distance?

Yes. Because the route is redrawn, the total distance stored in the app may differ slightly from the figure your watch showed when you finished.

Is Google snapping my run to the nearest road?

No. Road snapping assumes you were on a mapped route and moves your track onto it. Google instead uses building and terrain models to judge which satellite signals were trustworthy, so a park crossing or a lap of the track stays where you ran it.

Why can't dual-frequency GPS fix this on its own?

A receiver identifies a reflected signal by the extra distance it travelled, and there is a minimum below which the difference is too small to detect. That floor sits at roughly 29 metres on L5 and 290 metres on L1. Buildings lining a street sit far closer than either figure.