It causes a bunch of weird controller errors, such as when a controller disconnects (or if the deck goes to sleep), it can't reconnect again.
Just let it use the default version (which I believe should be Proton Hotfix, or whatever Valve decides it should be since BG3 is an AAA headliner, they'll want this to work)
I found that turning off VSync and setting the FPS limit to 30, along with capping the Steam Deck frame rate at 30 from the UI, gives me good results. I also turned off FSR 1.0, turned on fidelityFX sharpening, and slid the slider all the way to the right. My settings are mostly on low, except for texture quality, which I set to medium.
My FPS isn't always a steady 30, but the game stays very playable, even when it drops to the low 20s. I'm not super picky about performance.
I kinda struggle to get about an hour and a half of gameplay on a full charge (my battery health is at 97%).