They deliberately said they don't want to change performance characteristics - which is pretty normal for console refreshes.
The Steam Deck really isn't a console in any traditional sense of the word. With there now being multiple devices like this out there, I don't think that argument works.
What makes you think this is true?
But it's increasingly similar hardware inside, consoles are increasingly supporting more general purpose computing (media apps, social networking features, web browsing, game/app stores), the experience is more customizable, patching has made it much less "the game is the game", and the stupid simple reliability has gotten much less stupid simple. I'd say that the distance between PCs and consoles has been gradually shrinking since probably the release of the PS3/360, mostly due to consoles moving closer to PCs, but the Steam Deck is a big jump towards a PC being console-y.
PC games already automatically figure out what specs to use (or at least many do) so I am still struggling with this argument.
The argument completely falls apart when you have devices like the Asus Rog Ally or the Legion GO.
It also falls apart when, unless I am mistaken, SteamOS is open for anyone to use on other devices.
The Ally and the Legion GO (and other power constrained devices/devices with APUs) will benefit from some devs' performance and power optimizations for steam deck, and SteamOS based devices will benefit from fixes that work around issues with proton, both of which would be less likely to be addressed if there weren't an entire market of consumers you can access by getting that "Verified" badge.
IF that is the case, then the argument for why they would not increase the performance is not valid. They could have kept the same resolution but made it more powerful.
You can't say other devices will benefit and still make the argument that the steam deck had to stay at the same performance level. It's one or the other.
It's perfectly fine that Valve didn't want to upgrade it but I just don't buy the argument.
When you factor in that the niche market of slightly more powerful $600+ handhelds is already served by 4+ different players I just don't see why Valve would need to jump into it at this point. The marginal benefit is not worth the risk of fracturing the deck community and burning early adopters.
Also I should have made it more clear, but only some patches targeting the steam deck will trickle up to higher performance devices. Some patches will be things like "low shadows look like crap but medium shadows are just barely too much for the deck, lets lower medium a bit so that it can run well". I only mention that some patches will help other mobile devices because in my view its a win-win for the entire market that Valve is committed to providing a common denominator.
If one device is 1080p and one is 2160p, then even if both "render" at 1080 and one scales up to 2160 that is a change in performance. They don't want developers to have to test on multiple devices to see if it gets laggy on the one with the higher-res screen.