Yes, being x64 compatible but not supporting SSE4 or AVX is basically useless.

Rosetta won't support this, it's far from "useless". Good programs should detect the lack of support and fall back to earlier extensions.

Rosetta is a compatibility stopgap, not a whole new CPU. Apple making a new chip with the x86/x64 instruction set and not supporting any modern SIMD features would be pointless. I’ve seen AVX2 code that performs nearly 8x faster than scalar code on the same CPU.

Besides, where did you hear that Rosetta wont have to at least support SSE4? I think there are Mac apps that assume presence of these instructions since all of Apples macs since 2008 or so has had them.