UNC path pointing to local directory much slower than local access

This doesn't surprise me. You're writing/reading a fairly small amount of data, so the file system cache is probably minimizing the impact of the physical disk I/O; basically, the bottleneck is going to be the CPU. I'm not certain whether the traffic will be going via the TCP/IP stack or not but at a minimum the SMB protocol is involved. For one thing that means the requests are being passed back and forth between the SMB client process and the SMB server process, so you've got context switching between three distinct processes, including your own. Using the local file system path you're switching into kernel mode and back but no other process is involved. Context switching is much slower than the transition to and from kernel mode.

There are likely to be two distinct additional overheads, one per file and one per kilobyte of data. In this particular test the per file SMB overhead is likely to be dominant. Because the amount of data involved also affects the impact of physical disk I/O, you may find that this is only really a problem when dealing with lots of small files.