Well, at least the base model Xbox Ally has essentially the same SoC as the Steam Deck. The Z2 A has 4 Zen 2 cores and 8 RDNA 2 CUs. It will be configurable up to 20 watts TDP instead of 15 on the Deck, but that's it. So much for "long in the tooth technology wise".

Sure, the Z2 Extreme variant will be more powerful, but it'll also be in a different price category (800-900,-€).

And in terms of user-friendliness: the Xbox Ally will run Windows. It won't launch into the regular desktop shell (by default), and it won't have as many services running in the background which might help with performance and battery life, and you'll probably be able to update drivers and Windows through it. Maybe it will have some preconfigured scripts/shortcuts to install Steam, Battle.net etc. But that's it. Expect to fall back to the desktop mode (or open a browser, terminal and Explorer window in the new gaming mode) for anything more advanced like installing emulators.

In terms of pick up and play this won't be much different to the Steam Deck, with the one exception being Game Pass - but even then don't expect any of the more demanding titles to run well.

the steam deck is getting long in the tooth technology wise

lolwut? The Deck was released only three years ago.

This machine will be the same desktop-mode-not-required-but-allows-for-more-functionality thing that the Steam Deck is, but it will chew through battery faster in exchange for more compatibility.