Forza Horizon 4 or 5. They're a little sim-y but very arcady at the same time. Very enjoyable games. 4 is better in terms of the map and story / single player experience, but 5 has better audio and visuals and car selection.

Trackmania

Need for Speed Heat, the title before the current Unbound, was very well received. Currently on sale

I liked the Crew as a sort of racing rpg kinda thing

Sonic & All Stars Racing Transformed Collection is a blast if you're okay with a kart racer.

Flatout 2 is the OG combat racer.

If you're looking for a true "racing sim" type game I would probably recommend one of the Assetto Corsa games, either the original or competizione.

CarX Drift Racing Online is probably not what you expect, but is really fun. Not exactly a traditional "racing" game because you don't compete for time, but rather compete for "drift points," with longer/wider drifts getting more score. It has a surprisingly thorough singleplayer mode, and the multiplayer is relatively relaxed. Multiplayer is setup in an open-world style; you join a big lobby and can just drive around with friends or randoms without actually competing for anything, although people in each lobby can start competitions that everyone else can opt-in to. The main reason I'm recommending it is it has very thorough car customization and is a chill, non-competitive driving game, whether that be singleplayer or multiplayer.

Forza Horizon 4, buy Ultimate so you get the 2 map expansions.

BeamNG.Drive has a great driving and damage model and lots of car and map mods.

Wreckfest is a good time. Probably not a super technical racing game but I had a blast playing it.

SuperTuxKart

You can use your own maps/racers and play against your friends online

Bloodborne Nightmare Kart!

I loved playing "Driver: San Francisco" by Ubisoft. It's more of a driving game than a racing game set in an open world. However afaik you can't buy it digitally anymore for licensing reasons.

Also the Dirt series is quite nice

Not a racing sim, but a pretty chill driving game.

Take a look at American truck simulator or euro truck simulator 2

Both with huge discounts on steam currently.

Seconding Forza Horizon 5. It's pretty fun and casual while still offering some challenge. There's also Burnout Paradise, which is a bit older but still very good.

BallisticNG

Burnout: Paradise. I have many an hour in this game.

I was on a similar situation, I got NFS Heat in the steam sale and it's pretty good. Like you I also liked NFS Underground and heat is very similar. The night and day mechanic is pretty cool. Regular circuit races during the day, illigal street racing at night with cop chases. You customize your cars to make them perform better, get reputation to level up and buy better upgrades. Overall it scratches that ich for a fun racing game.

Also interested.

• Absolute Drift Steam / GOG
• Need for Speed Hot Pursuit Remastered
• Wreckfest Steam / GOG

Forza horizon 4 or 5 are both pretty good, though they are missing an important car from 3. But still pretty good, racing other players is not required, there is a lot to do as well.

New need for speeds being heat and unbound are both pretty good.

Wreckfest is fun if you are looking for more carnage.

Grid is okay

Have you ever played Rollcage back in the day? There's a spiritual successor to it now by the original team - GRIP. It's very much the same as it used to be, just with modern graphics.

BLUR is like a more realistic version of Mario Kart, yet not a sim.

A rather different take on casual arcade racing, but I quite like Wreckfest.

There's a demo for a game called Rollin' Rascal that's basically a Sonic clone, but there's a multiplayer racing portion of it that's actually really fun. There's no stakes, it's just competing for the sake of winning, and it's really fun trying to figure out where the best routes would be. You can customize your "rascal" with different color palettes, or you can make a couple color schemes of your own, and give him a hat if you want.

The demo has two campaign levels available, but I'd still recommend it for the multiplayer racing aspect.

I really liked Mad Max and Days Gone where the focus was upgrading your one vehicle. I really wish there was more out there like it, but Im unaware of any.