There's a lot of wasted space on the right side of this keyboard where they could have easily put the Del/PgUp/PgDn keys right there. I don't know why they didn't.
Judging from the USB-C at the top and other tact/slide switches on the side, my guess is that the MCU and a prismatic battery of sorts (500mAh Li-ion?) occupies that space. A low profile design will always have some tradeoffs; perhaps an oled in that space is possible with a cutout for a badge.
Controllers are really small these days and fit just fine in the gaps between keys (see link below for a typical example). It’s almost certainly mostly for the battery.
You are correct! There was not enough space below the keys due to the device's low profile. So the right hand area houses the MCU, USB C port, battery, as well as the 2 slide switches and button that poke out the side of the case.
