Understanding the blue gear icon on iPad

The icon indicates that your iPad is synchronising with "something".

Yours is one of many reports seen in recent weeks. At present, pending confirmation by Apple, this appearance of the icon is believed to have some relationship to post-update synchronisation tasks performed by your iPad after updating to iPadOS 18.x - or the icon appears while a download is being performed as a background task.

Apple have not yet provided a definitive explanation.

Apple's documentation is often slow to catch-up with new features. Here is another status icon - that appears briefly when connecting some USB-C hubs - that Apple have yet to add to their documentation:

I think this might be a little helpful. In my case it appears that my iPad was downloading a profile for my camera’s RAW files when this icon appeared.

Does iPadOS support uncompressed RAW file… - Apple Community