They absolutely took the console business model on the Steam Deck. Just like the other big guys Sony, Nin, Micro. Sell the hardware at a loss with the promise that the customer will buy the associated products, in this case, the games from the steam store. The bigger and better difference of course being that you can do whatever with the steam Deck. But Valve knows that the majority will still get their games from Steam because it's just easier that way.

It's the old razor blade model. Sell the handle cheap because you know people will buy the razors for it, and they most likely buy your brand of razors since you bought their brand of handle.

Printer companies (at least home consumer ones) do it too but are slimy about it. Get a printer for $50 then buy ink for it that often costs twice as much.