AFAIU that tells you if your access to ipinfo.io is thru a residential proxy, not if somebody else is using a residential proxy on your network.

It's effectively the same thing. If a residential proxy is running on your network, your IP will soon become known as a residential proxy exit.

It detects if your IP is a residential proxy, not if you are using a residential proxy. From the perspective of the outside Internet, they are the same thing, the only one who cares about the difference is you.