The cached files is first of all only low resolution versions of your high res. stills & videos that gets stored on the SD card in your Mini 2. Furthermore the cached versions aren't quite copies from the SD version ... the cache is mainly saved recordings of your live view on the mobile device, so if you have for instance smaller connection glitches they will be seen in the cached files but not in the SD version.
The downside with having this function with saving cache file activated can be ... your mobile device isn't the most modern one & isn't up to the additional workload, meaning it can run hotter or actually crash running apps in your mobile device ... like the DJI Fly app.
On the upside you have a saved low res. copy of the last thing you filmed if you go down somewhere ... might give you clues what happened to your Mini 2 in case of a disaster. You also have some quick access to photos & videos if you either want to check the framing or if you want to post something on social media that doesn't need to be high res.
It's also good to know that this function have always been a bit of a hit or miss ... for some or sometimes the cached files are recorded properly ... for others or sometimes it doesn't work properly.