When I first read that the ship a dedicated Distrobox container just for Steam, I was utterly confused as to what the benefit would be and I still cannot see it. Maybe the Bazzite developers dislike some of the restricted permissions of the Steam Flatpak or maybe they just want to package it on their own but the benefit for the user escapes me.

I've read another comment and then I realized it's because of Bazzite's Game Mode session. It's a special login session and not just Steam in Big Picture Mode. Flatpaks cannot be used for this kind of specific use case.