The limitation is related to the abandonment of the kernel-level driver, which displeased some players.
The Steam Controller still cannot be fully used with consoles, except for the Steam Machine, which is rather classified as a "living room PC" format. The gamepad also does not support games outside the Steam ecosystem: they can be added to the library through a special option, but in this case, control issues may occur.
tech
Valve explained why the Steam Controller does not work without the Steam launcher
naiwa
The limitation is related to the abandonment of the kernel-level driver, which displeased some players.