Hi Graham,
not only is Funnelback a superior search engine appliance, but Squiz Matrix and Funnelback are both designed to make integration between the two a lot easier and smoother. I would say that almost about 80 or even 90% of our Squiz Matrix clients have some sort of Funnelback integration happening. Most sites have backend integration with an external Funnelback server so the user's experience on your site is seamless and they never leaves your website's domain.
You can also do very powerful imports and indexes and present that information within Squiz Matrix. So with Funnelback, you can index several external repositories or databases, bring it all together in 1 index, and present it all together for the user. For example, QAG index their social media profiles and present those on their main website search as facets: http://www.qagoma.qld.gov.au/fb-search?query=art&collection=qag-meta&x=-1351&y=-163
Furthermore, you can use it as an import tool and not only as a search. So it can index an external database on a daily basis, analyse the content, and then either create, modify, or delete assets in Matrix based on the records found in the index.
I could go on all day and I'm sure someone from Funnelback will reply with even more information. But pretty much, anything that is not possible with Squiz Matrix, is possible if you bring Funnelback into the mix.