You're right, some of the recommendations definitely seem off. I think part of the issue might be an inherent bias in recommendation systems toward popular artists rather than stylistic similarity, simply because they're more frequently tagged, streamed, and linked in user data.
I'm not sure how Apple Music does it on the backend, but if I had to guess it would be based off of genre and playlist/user activity (Some sort of statistical model which determines which artists are likely to be present in user playlists/listening activity together).