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tl;dr: yes, credentials are cached locally. https://github.com/dani-garcia/vaultwarden/discussions/4676
The major downside to the single file storage used by Keepass is that it's easy to accidentally create a conflict between files on different devices if they're not synced immediately. Conflicting files have to be merged manually or data might be lost. I've run into this several times with Keepass + Nextcloud. In comparison, a central master database with local cache can resolve conflicts between individual records.
On the other hand, Vaultwarden can only be updated online. While I do use it, I consider it a major downside, along with the inability to sync attachments.