Happy to help. As I have it configured, my local network is set to prefer direct play, so any transcoding gets done from connections that traverse the boundary of my network. If you don’t live with your parents this would likely apply.
Transcoding may also occur when you have subtitled content and I believe for certain audio formats, but the transcoding would be limited to the audio track.
Love a tracker! I saw people running dirtywave M8 headless on a steam deck. Needs a teensy connected and some packages/config, nearly tried it myself but got a preorder for a M8 instead.