`a if b` is equivalent to `a or not(b)`, so yes, `policycoreutils` is only a requirement if `selinux-policy-targeted` is installed.
The `if` operator applies to the whole dependency, so `selinux-policy >= 3.14.3-95.0.1.el8` is only required if `selinux-policy-targeted` is installed.
`if` in this context is a boolean operator in RPM, and is documented in the Boolean Dependencies section of the RPM Reference Manual.