My guess on the issues with BG3 is that the game works great solo but become too taxing on the memory with coop. Either on bandwith or pool size.
It might be that they don't want to create another sets of lower quality assets for the Series S. Using lower quality assets is common in split screen and may even be used with Ps5 and Series X but it might be so that this easy path with Series S push the quality under a thresold to which they are not willing to go for experience sake and as a result scramble to find alternative solutions with various optimisations.
Or something alone this line.
We know the Series S have ample headrooms while targeting 1/4 of series X resolutions (output and assets). But this is the easy and lazy path as those headrooms can be used to create a better experience and that's where normal porting struggle and optimisation hit.
So to me this sound more like Larian is actualy putting in efforts and trying to get the best experience possible on the Series S which they might have underestimated and started too late and just need more time.
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