The Steam Deck addresses a different audience, is more expensive, has a shorter battery life, is heavier and storage is limited unless you buy the extra expensive model and even then games take more space than on the Switch because they won't be optimised for the Steam Deck. Also the Switch is generally more convenient because you don't need to do stuff like install Windows and you know exactly that all games available are able to run on the system, what isn't necessarily the case with the Steam Deck.
The most powerfull handheld was always the least selling. The Steam Deck having high specs doesn't mean anything. It's been said over and over again: the Atari Lynx and Game Gear were destroyed by the Game Boy, the PSP sold just over half of what the DS sold, the Vita was destroyed by the 3DS. It's always "OMG we have the highest specs!" and then they fail. Same with home consoles except for the PS4.
Handheld gamers don't care about specs.
It won't have any impact on the Switch whatsoever.
Different audience indeed, which leaves me kinda puzzled with how high the hype is for this handheld. It's no 4K, no 1440p, it's effectively 720p. Going from a big desktop screen (or multiple) with keyboard, mouse, hotas and what not, to a handheld.
It's a very cool peace of tech, yet as you said, it will require work to get things running smoothly with the control options you want. And some games probably are better left on the desktop when it comes to lots of menus with small text. The thought of having FS2020 on a handheld is very cool, however thinking of actually playing it on a handheld, no way. I mean, I'm 'playing' it right now, listening to the plane engine, my music while alt-tabbing back and forth to check the scenery and distance left to the next airport.
I can think of very few PC games I would want to actually play on a handheld, however I think the same about the Switch. It will be a device to show off for sure, lots of you tube videos incoming with everything people can think of to run on it. But it won't persuade any Switch buyers to switch.