It’s a personal preference but I would take occasional smearing over janky frame rate, I don’t know why but if you are not a solid 60,90,120 it just feels really like there is a stutter every second or two even though it should be fine if it’s above 60fps.
For some games I’m happy to turn it on as it drops power/temps and provides virtually identical output (as far as i can tell anyway) to native, but my fans don’t need to go into overdrive mode.
I may even put on frame gen too if I just want to bump a stable-ish 80-90fps to stable 120fps, and again drops power and temps slightly. That sometimes does cause smearing but for the most part I don’t notice enough to be annoyed. Without them I would probably be running with more power draw and higher temps, and possibly still not even hitting lower resolutions at 120, some games as you say though can hit 120 no problem even without and the gpu won’t be stressed.
The consensus seems to be that AMD priced their cards higher expecting Nvidia to price higher than they did.
Then Nvidia priced lower than they expected (still too expensive imo) and AMD needed to react and price their card cheaper. Problem is retailers already paid for shipments so AMD needed to settle some sort of reimbursement process for the soon to be out of pocket retailers.
This was a big issue for them, but also they realised they could generate more frames if they wanted to, and match Nvidia so they would be able to also claim crazy high FPS figures (it’s all nonsense, we care about raster performance).
To be able to do this they needed a couple of months to dev and test it before reviewers get it.
So delaying launch let’s them solve both problems with the extra time, but in reality they are missing a window to gain market advantage while also being able to align the narrative with what gamers care about (pure raster performance).
In some games it’s super obvious that it’s doing upscaling and looks awful, some games with without upscaling look awful (TAA), it’s odd that in some cases tools like Dlss can look better than native TAA.
For the most part though it feels like the FLAC vs Opus or whatever, most people can’t notice difference and don’t care enough about it, but some people can tell the difference and want the best, I don’t think either are wrong it’s just down to how much you notice/can tolerate before it’s annoying.