I just got the high end 16" Macbook Pro with 8 Core CPU and 5500M GPU and when I'm trying to export a H264 video, it only uses the CPU and Intel UHD Graphics 630. I assume that it's just using quicksync for the export and maybe the T2 chip but it almost completely ignores the dedicated 5500M GPU.

On my 2017 MBP, the system would load up both the iGPU & dedicated GPU on export for H264. Given so little CPU usage and maxing out of the iGPU while ignoring the dedicated GPU, it looks like there's really no benefit in upgrading to the 8 Core & better GPU for the new macbook pro. Is this normal behavior?

Also, is there a reason why choosing the "Master" H264 .MOV is substantially faster than Computer > H264 Better Quality?

Export consists of two conceptual phases, render and encode. Render can (and should) use the dedicated GPU -- provided you have GPU-accelerated effects that would benefit. Not all effects can leverage the GPU, and some (like Neat Video) have adjustable CPU/GPU split.

By contrast H.264 encoding is almost totally CPU-limited. The core algorithm is inherently sequential and cannot effectively use hundreds of lightweight GPU threads. It can only be meaningfully accelerated by running the core algorithm at hardware speeds, which is what Quick Sync and T2 do.

There is no Activity Monitor parameter for Quick Sync or T2, so there is no easy way to tell if those specific functional blocks are being used separate from the containing logic. Even though the MBP has Quick Sync, it also has T2, and there are some indications Apple is using the T2 for Long GOP encoding.

I think you can actually test this on the new 16" MBP by exporting 8-bit vs 10-bit HEVC. On all prior machines 10-bit HEVC output was very slow since T2 apparently did not support that. Supposedly on the 16" MBP the revised T2 chip does support that so it's much faster.

A good way to export is using Master File>Computer>H.264>Faster Encode. That uses single-pass encoding. I cannot tell any visual difference between that and "Better Quality". The Master File>Audio/Video>H.264 export uses slightly different encoding vs Computer>H.264>Fast, but they are fairly similar.