Well put. I think the only area where Series S could theoretically hold back multiplatform games is the lack of compute. I recall when PS4 was announced and Mark Cerny was talking to everybody in 2013,
he absolutely believed that more and more traditional CPU tasks would migrate to GPU compute in the future and that having more compute was critical. I don't know if this was really every a thing that happened this gen - I can't recall any detailed GDC presentations on this subject - or whether the more capable compute units in nextgen make this more likely nextgen but it's pretty much the only area where Series S looks a bit underwhelming.
But as Ive said before, I think on balance that Series S will probably be a more capable and balanced system for delivering 1080p/1440p games than either Series X or PS5 will for 4K content - subject to the final confirmation on Series S memory bandwidth. And I still expect Series S to clean One X's chronometer in terms of performance in most games.