this post was submitted on 02 Jul 2023
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Arc won't have proper game support until it's using the Xe driver (not until at least kernel 6.5) instead of i915. You can follow the progress of sparse rendering support for Xe here. Hardware AV1 encoding will not be supported with Xe, however.
If you want to stream your gaming (as long as it doesn't require sparse rendering) and enjoy hardware AV1 encoding of the video you will have to disable Xe and revert to i915. You can choose one or the other.
There is a little hope for i915 to fake sparse rendering support (for games that don't really use it, yet expect the feature flag). But you will still be stuck with last gen driver performance unless the optimizations are back-ported somehow.