[kibwen]

This interpretation is very unlikely, given that it would be redundant with the first bullet point: "If you haven’t used Face ID in 48 hours [...] it will ask for a passcode".

Assuming that Apple engineers aren't stupid, the correct interpretation is "we want people to enter their passwords at least once a week so they don't forget them, but we also don't want to bother them if they're in the middle of something". So yes, once a week, you will be forced to type your password upon waking up.

[cbhl]

I read it as "you need to enter your password if you haven't used your phone in a week, but if you use your phone every day, you only have to enter your password after each reboot"