Valve is difficult. On the one hand they have their own Wayland compositor with gamescope. Which works by launching an explicitly configured XWayland session for the game.
And on the other hand there’s Steam, which is still an X application.
And on top of that are stupid Steam Input bugs that only happen when you try to launch a game with gamescope.
On the Steam Deck in gaming mode Gamescope is the main compositor which launches two XWayland sessions. I guess one for Steam and one for the game.