Q: How do I use dictation on iPad Pro keyboard? Which key?

From the page that you posted from :

You might need to use your software keyboard instead of the Smart Keyboard to do things like type accented characters or use dictation. To show the software keyboard, you can fold the Smart Keyboard behind the display (Watch position) or slightly lift the iPad from the Smart Keyboard groove.

Jkdoug wrote:

 

That is what  I am doing right now, which is kino of inefficient.

It is a bit on the inelegant side. You can submit feedback to Apple requesting they change it here:

http://www.apple.com/feedback