however it stores all funds on-chain and not on-lightning for a user. So every incoming payment is a splice-out
This doesn't make the most sense. Splice-out/ins (and I think you're referring to splice-in for incoming payment?) only apply to funds held in a lightning channel. All funds in lightning channels are anchored onchain, which is how splice works.
Do you mean to say all onchain movements in Muun are performed with splice in/out's?