What happens if you throw the car into neutral whilst in motion?
I would say that if you're below the constant power speed, the motor controller will do nothing, apart from allowing the motor to coast, and as always, monitoring the speed of the motor.
If the car is above that speed, then the motor controller is already bucking the permanent magnet. In neutral, it will continue to do that, as otherwise the motor would uncontrollably regenerate, this time into the battery. It would reduce the torque producing current to zero, so the motor and car are coasting. The torque producing and magnetising currents are at 90° to each other, so they can and must be controlled independently.
So nothing bad happens. Some drivers like to coast in neutral, as they find it's good for economy. The motor controller can find zero torque more accurately than the driver with the pedal.
But you'd think if it were dumping that energy as heat there would be a lot of it at speed.
The back EMF is a voltage, a potential. Just like the permanent magnet; it seems like something for free, but it performs no work (no energy is transferred) unless it's moving inside a coil of conducting wire. Even then, no work is done, unless the circumstances are right.
In the case of an electric motor being towed with the driven wheels on the ground, there is potential energy from the tow truck spinning the motor. But it causes little heat if the car is in neutral, just mechanical losses (friction and windage), and a small electrical loss from current flowing in the windings to weaken the field of the permanent magnet.
I'll agree it sounds crazy, but that's how permanent magnet motors work. Some cars try to avoid this sort of problem with induction motors, which have no permanent magnets. But it turns out that a tiny residual magnetism in the motor can "bootstrap" an induction motor into an induction generator. So you still need precautions with an induction motor.