I am not yet using Tahoe. But at least in Sequoia and Monterey iCloud Drive folder icon always flashes briefly (less than 1 sec) when opening any document that is already up-to-date (screenshot attached).
I think that relates only to a "kick" to check if iCloud contents are up-to-date regarding that document (and apparently at least the enclosing folder -- sometimes iCloud Drive is very slow to automatically update its contents). That icon update lasts longer if there is anything that really needs downloading.
FWIW my pet peeve is that when opening documents with apps like LibreOffice cause that iCloud Drive folder icon to flash but LibreOffice then still might open an old version. So I have a habit to do a dummy open-close-open ritual to make sure I don't start editing an old version of the document. On the other hand, BBEdit seems to on-the-fly open such freshly updated iCloud document.
