Well, "on die" actually means that the external temperature measured is the value directly received from the MPC7447A PPC CPU which has an "on die" temperature diode:MPC7447A datasheet
Local temperature bottom side is directly measured by the MAX6642 temperature sensor which I don't really know it's location of on the logic board but it most likely measures more of the ambient temperature. As the "northbridge" and GPU are both located on the opposite side of the logic board, it might be somewhere around there.
Why the "core" temperature is somewhat lower than the actual "ambient" temperature is something I don't really know.
It is a little bit strange, but with temperature around 55°C on CPU thermal diode there is enough reserve for (for example) not exact calibration, etc.
Before overclocking of my Mini I read the forums and there is often opinion that Mini have much bigger problem with cooling of GPU than CPU.
MPC7447A HW spec I read before overclocking. But I cannot find anywhere MPC7447B
So for simplification I assumed, that only difference was higher Maximum Rated
Core Frequency - maybe 1.5 - 1.67 GHz
This overclocking was the most risky I did. Without exact CPU documentation and without possibility of better cooling. Not to say the PLL config pins and rezistors on Mac Mini are really microscopic.
Only thing that calmed me down was your temperature utility.
AmigaOS: Micro A1-C, AmigaOne XE, Pegasos II, Sam440ep, Sam440ep-flex, AmigaOneX1000
MorphOS: Efika 5200b, Pegasos I, Pegasos II, Powerbook G4, Mac Mini, iMac G5, Powermac G5 Quad