I've been shipping non-IoT embedded Linux products for over a decade and, honestly, I don't give a shit about what version of Linux it's running as long as the necessary drivers are compatible and working well. USB, ext4, SD/MMC, SPI, I2C, PWM, GPIO, backlight, framebuffer video...all pretty mature now.
Agonizing about being mainline is a distraction from getting things done, IMO. ARM Linux will never be fully up to bleeding edge.
Sometimes this hinders you and your customers from getting things done. Mainly because vendor kernels are, generally, really bad. Second to none other than their userspace drivers, and I want my users to be generally running a well-supported, solid software instead of whatever ${VENDOR} ships.
> USB, ext4, SD/MMC, SPI, I2C, PWM, GPIO, backlight, framebuffer video...all pretty mature now.
That's pretty basic stuff, but SPI/I2C drivers for example have issues /all the time/. It's just nice to get the fixes from mainline and integrate easier.
Other than that, custom SoCs are much more complex than the bread and butter you mentioned: NPUs, VPUs, signal processing chips etc are all a gigantic pain in vendor kernels, simply because the code is garbage.