The new Mario Kart is also great, and the larger screen is great too. At 45 I don't need to use reading glasses when I use Virtual Console, but on the OLED Switch I usually use reading glasses with Virtual Console.
Do a barrel roll!
But the Switch 2 shines for Nintendo gaming on a 4K display and for actually being able to play PS4-era games well on a handheld.
I am not completely sold on Mario Kart World's open-world driving (vs. Mario Kart 8's track-only approach), but it's still a lot of fun, plays well, looks fantastic, and scales up to 24 players for LAN games and tournaments.
Nintendo makes fun games that I want to play. I want to play the new Metroid, the new Pokémon games, Kirby DLC, etc. Maybe it's nostalgia, but I grew up with the original Metroid, and that series sticks with me.
The switch 1 gets a ton of use in my house. Switch 1 games perform so much better on the 2.
The pro controller for the switch 2 is incredible.
Switch 2 is cheaper, significantly cheaper if you play docked. Our family uses it to play docked a lot.
The switch 2 library is large enough that you can play a lot of the same titles you can on the deck. Or at least enough games you'll never run out of fun options. You don't need to have the biggest library to be fun.
I have a powerful PC in my house for when I want to play shooters and 4x games. The switch 2 library gets way more exercise.
(But if you like the games on Steam, then the Steam deck makes a lot of sense.)