I can see how this would be appealing to a lot of developers. Get a great game to run well in docked mode, and you've got a pretty straight path for a great handheld game as well. Can't wait til January.

Uh... Yeah they do.  Pro has 1080p minimum res requirement, nothing such exists on OG-spec PS4.
We have already seen Pro games with performance issues not seen in OG version, that is QA/optimization issue.
Sony does not allow devs to continue to release games only written for OG-spec (and run in compatability mode on Pro),
all games must have Pro mode that do not run in compatability mode, meaning different CPU speed, different GPU.
Switch devs DO have the opportunity to prevent their games running in high performance dock mode if they wish.
(and they can force higher memory bandwidth or something in portable mode, if I recall, although it hits battery life)
Switch handheld/console have exact same CPU speed unlike OG/Pro, and devs have option to forgo higher GPU clock if they wish.
The hardware performance differences are fewer than Pro, and devs have zero mandates to leverage power differences.

Oh it's definitely possible.

My concern was more that devs would be too cheap/lazy to take full advantage of it, and simply boost resolution when docked while leaving other graphical settings the same.

Hmm, I just realized Switch is a whole lot more challenging than a pro patch. The hardware profile can change at any time. It's nothing like starting a separate executable on pro with different assets loaded in memory. It's even more of a challenge than on PC where the game has the option to reset after you change settings and sometimes asks you to restart the game depending on the settings.

Seems most likely that games will be coded for handheld mode with very modest changes to docked mode. A simple resolution boost might be it for most games. Or could it be that docking/undocking won't be as simple as shown. Perhaps some games will save and restart on a mode switch? Or at least it won't be as smooth as shown and the game might pause or drop speed for a while before recovering with simpler assets.

It better pause.

It seems logical you pause it yourself before docking/undocking, you still need to put the controllers on or take them off. Although some games don't allow you to pause like Dark souls and online games in general. Dunno how realistic that concept video is in practice. It seems a lot of hassle to program for seamless transitions while most people won't change operating modes in the middle of a game. Big promise from NIntendo.

I''m actually not assuming that at all. This is the only thing we have to go by. You're assuming there's more, a lot more, enough in fact for it to be a feature that will make development on the switch markedly easier. You're assuming these profiles indicate a feature that will make utilizing docked performance easier, and ensure it's easier to scale for both modes when in reality there's no reason to think that based on what we know. For all we know this profile is literally just to set basic screen resolution parameters as a basic function, isn't related to any grander feature, and exists only to allow UE4 to even run on the Switch.

You remind me a lot of the people who saw the fact that the Nintendo switch dock had a vent and automatically assumed it has additional processing power built inside it. Of course, we know now that that's complete nonsense, but there were many people that were absolutely positive they were right. Sure it could mean that but we're just seeing a glance. Go ahead and make all the grand, speculative assumptions you want, but in order to avoid embarassment, you may want to avoid presenting them as fact.

That's right. You actually have to make the engine so it constantly checks its running mode, and be able to accomodate whatever changes the system needs to make in terms of rendering, draw distance, animation, etc. on the fly. That could literally mean loading two versions of assets in memory when other console games or PC games would only ever have to load one. In order to accomodate that it could mean that there could be many seconds (possibly dozens, similar to a load screen) of pausing when going between docked and undocked modes while the consoles accomodates its new running mode, and the engine catches up. I wouldn't necessarily say it's more of a challenge than developing a PC game, but there definitely unqiue challenges to developing for this platform that aren't just arbitrarily solved by changing a slider or making a changes to a hardware profile like some here appear to believe.

I honestly doubt it's really that complicated. It's just really poor OS design. When you undock the Switch, Nintendo OS should pop up a UI by default letting you know the Switch was disconnected and prompting you to resume. Nothing else makes sense. There's literally no practical reason anyone would want the game to continue running when you won't be playing the game while you're undocking.

In the concept video the player is standing in the middle of a field in Zelda, grass keeps waving while he takes the switch out of the dock, seamless. But perhaps that was just for dramatic effect... It seems best to pause it, yet that leads to easy abuse in online games. Those might not have different assets anyway, equal playing field between docked and undocked. I guess we'll see a whole range of different takes on the actual switch behaviour.