The stub content is generated using Josverl/micropython-stubber using the minified version of createstubs.py. Some polyfilling and post-processing is required since the Pico board doesn't support ujson which is used by createstubs.py.
To generate the stub files, copy all the files within the board folder to your Pico and then reboot it. You can do this either via Pico-Go or via Thonny.
Upon reboot, you will see that the stub generation begins after a short delay.
Once complete, you'll need to copy all the generated files back to your computer.
Copy the "micropython" folder that's been created on your Pico back to your computer.
Then run the post/post-process.py script. This will create sub-folders within the /dist folder for both Micropy-CLI and Pylance.