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NVidia DLSS 3.5 dlls are available
(videocardz.com)
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When I first discovered DLSS/FSR, I thought it was a miracle. It allowed my antient PC to run Horizon : Zero Dawn reasonably well.
Then I tried it on the steamdeck, just to be shocked how horrible it looks. Turns out the magic ingredient was my myopia. I just couldn't see the imperfections while sitting 2 meters away from the TV.
Steam Deck is also only an 800p screen, so using DLSS/FSR will render the game even lower than that. Basically the upscaling just works better at higher resolutions since it has more data to use. And like you said, definitely better for farther viewing distances too.