There are many different ways to improve older games on a new (much more powerful) hardware:
- no backwards compatibility... probably improved versions for the new hardware later (often for full price)
- backwards compatibility, but no improvements (besides more stable 30 fps or more stable 60 fps)
- backwards compatibility with minor resolution boost for games with dynamic resolutions
- backwards compatibility with big resolution boost (f.e. 720p -> 1440p or 1080p -> 4K), no other improvements
- backwards compatibility with fps boost (f.e. 30 fps -> 60 fps), no other improvements
- backwards compatibility with resolution and/or fps boost plus other improvements (f.e. better textures, lighting, level of detail to fully use the better hardware)
There are also many different ways to cash in on these improvements (free upgrades, paid upgrades, no upgrade path but new versions).
And of course the platform owner can't force third party publishers how they support the new hardware... BUT they can set a good example with their first party titles.
In the past most "backwards compatible" Nintendo home consoles and handhelds had BC with no improvements (SNES, Wii, WiiU, GBA, DS, 3DS) or very minor improvements (some DS games on DSi, some 3DS games on New 3DS).
But times change and Switch 1 games have to be scalable anyways (docked and undocked mode), so improvements for new hardware should be much easier. Upgrade data (f.e. texture packs, shader compilations) can be easily downloaded and stored on dirty cheap microSD-cards, both for digital Switch games and for physical modules.
Also there are many examples, how the competition handles it:
- many PS4 games got a free PS4 Pro patch/version with improvements, the rest is compatible without improvements
- some PS4 games got a free PS5 patch/version with improvements, the rest is compatible without improvements
- some PS4 games offer a paid upgrade to an improved PS5 version (usually $5 - $15 for the upgrade DLC)
- many Xbox 360 games got a free Xbox One/Series patch/version with improvements, many others are compatible without improvements, some aren't compatible
- many Xbox One games got a free Xbox One X patch/version with improvements, the rest is compatible without improvements
- many Xbox One games got a free Xbox Series patch/version with improvements, the rest is compatible without improvements
- as far as I know there aren't any Xbox One games with a paid upgrade path to an improved Xbox Series version... at least first party
- almost all PC games can use improvements due to more powerful hardware for free... f.e. a Rog Ally can use better settings than a Steam Deck, the Steam Deck 2 will offer much better settings for free, and so forth...
So what are your expectations for the BC on Switch 2 for Nintendo's first party titles?
