Wayland works fine with Nvidia’s drivers. It has worked fine for years. Nvidia was the only option for 3D graphics on Linux 20 years ago.

Interestingly, the SteamOS documentation mentions Nvidia driver support:

https://github.com/ValveSoftware/SteamOS/wiki/Getting-Starte...

That is for SteamOS 2. The newer SteamOS 3 does not officially support anything other than AMD hardware because the Steam Deck uses AMD hardware and their current focus is on improving support for that.