Yeah non-upgradable 8GB VRAM would make it a no-go for all but the most casual gamers. But then the casual gamers would rather buy a PS5 for the same price, so let's see where this one fits in.
As a Steam Deck owner since pre-orders, unless the price is extremely high, I am going to get the Steam Machine as well. Kids plug the Steam Deck to TV to do couch co-op gaming even though the resolution is only 720p. So getting a better resolution and performance while still getting access to the huge Steam library and non-steam games (Minecraft, etc.) is worth it. I don't care about the latest AAA titles and FPS shooters, for those I already have a desktop PC.
PS5 is too expensive long term and is not usable for anything else.
And when Steam Machine becomes obsolete, I'll probably just use it/gift it as a mini pc/home-server to someone in the family.
Quite a lot of actual casual games, things you'd see in the indie or "cosy"/stardew valley-like genre only release on PC, or they take years to come to the Switch but nothing else. I see a lot of casual gamers getting the Steam Deck just because it's has the best selection of casual games.
For casual games even the steam deck can run most of them at 4k 60fps
It's essentially an RX 7600, roughly. It's not quite 'the most casual gamer', but it isn't super amazing. But... neither is the steam deck, and steam deck flies off the shelves.
