Wallace is merely using "metaphysical difficulties" as shorthand for "justifying the use of infinitesimals". Authors ranging from Leibniz to Carnot have written texts entitled "the metaphysics of the calculus" or something of that order, and one of the issues had traditionally been the justification of infinitesimals.
Contrary to Wallace's claim, Cauchy did not "define infinitesimals in terms of limits"; such a claim would be incomprehensible even today. What Cauchy did do is define both infinitesimals and limits in terms of a notion of a variable quantity, taken as primitive. If such a quantity gets arbitrarily small, it "becomes" an infinitesimal; the limit of such a quantity is $0$ (by definition).
Wallace's claim that Cauchy's analysis is "beholden to geometry" is similarly dubious. There is not a single picture in Cauchy's foundational texts on analysis. Cauchy put much effort into avoiding purely geometrical arguments. His proof of the intermediate value theorem, given in an appendix, is a convincing example.
On the other hand, Cauchy's book on differential geometry does use some geometric arguments, including some which exploit infinitesimals. You can read more about this in
Katz, M. "Episodes from the history of infinitesimals." British Journal for the History of Mathematics 40 (2025), no. 2, 123-135. https://doi.org/10.1080/26375451.2025.2474811, https://arxiv.org/abs/2503.04313
The best 20th century Cauchy historian is Detlef Laugwitz. You can consult some of his work linked at https://u.cs.biu.ac.il/~katzmik/laugwitz.html.
Note. I have studied all three texts mentioned in the comments
(1. Jourdain, P. E. (1913). The origin of Cauchy's conceptions of a
definite integral and of the continuity of a function. Isis, 1(4),
661-703; 2. Smithies, F. (1986). Cauchy's conception of rigour in
analysis. Archive for history of exact sciences, 41-61; 3. Belhoste,
B. (1991). Augustin-Louis Cauchy: A Biography. Springer) and found
them to contain errors of interpretation bordering on the comical, and
general inattention to what Cauchy actually wrote on this issue. See
also Is mathematical history written by the
victors.