I just got an email telling me that I can now add my passport to Apple Wallet. I happened to have it handy so I went through the process and it's pretty simple.
You first scan the photo page and then once it reads that, you have to go to the last page where the chip is and lay it there so that it recognizes that. Then it takes you through a number of facial poses. At the end it tells you you're done but it still has to be verified. I believe this is also available for Google Wallet and I'm assuming that the process is about the same.
Just remember that you cannot use it at this time for overseas travel; only for domestic. But if you don't have a real ID yet, you can use it for that. Here is the caveat:
To create a Digital ID in wallet you must have an authentic and unexpired U.S. passport and an iPhone 11 or later with iOS 26.1 or later, or Apple Watch Series 6 or later with WatchOS 26.1 or later. Digital ID in Wallet can only be used at select TSA checkpoints in the U.S. to verify identity for domestic travel. It is not a replacement for a physical passport and cannot be used to perform functions of a passport like international travel and border crossing. You will still need an authentic and unexpired physical U.S. passport for such functions.
UPDATE: Just an FYI, it took about 5 minutes for it to verify my passport and it's now on my phone and my Apple watch. Also, I just noticed that it does not have my last name on there. It has my first and middle name but only the initial of my last name. I am assuming this is for privacy and security reasons.
ANOTHER UPDATE: I just got another email from Apple with a video showing how to present it to the TSA at the airport. It was very helpful. Here's a link to it: https://learn.wallet.apple/id#how-to-tiles