TL;DR - if there’s lateral play in your pedals with the end caps removed (or loose) it doesn’t necessarily mean that the internal nut on the end of the spindle is loose - the end cap is required for preload.
I know there are lots of other topics about these pedals here but I just spent like 20 minutes using the search feature and then google before I finally managed to find the following answer I was looking for. Rather than resurrect a 4-year old thread I’m re-posting it here with a more searchable topic title so it’s easier to locate for others in the future.
I can’t find anything from Favero saying the end caps provide the bearing preload by design, so I’m not sure if that’s how Favero/Xpedo designed the system but it’s clearly part of how it functions in reality.