This will probably be the biggest competition the Steam Deck has within the handheld PC space.
Most noteworthy is that windows is finally focusing on providing a decent handheld experience, including booting straight to a controller friendly interface, and reducing background processes for better fps and battery.
Edit: The handheld Xbox UI will.come to all windows PCs, but it's not clear if the reduced performance bloat version will be available. It sounds like only Xbox branded devices may get the full benefit of optimized windows.
It's also the ugliest handheld PC yet (imo), but I can appreciate that they're pushing for comfort over looks.
Supposedly they were working on an inhouse one, and then changed directions to just do software tweaks for other companies hardware instead.
It definitely needs some background process limiting, comparing official windows vs official steamOS on that Lenovo legion Go showed pretty terrible performance impact from running windows.