If it turns out that this path is acceptable to the masses, I am 100% on board with all game developers following a similar pattern. Personally, I don't have a problem with this, especially considering most games I install these days are upwards of 100 gigabytes anyways. If 2 gigabytes of each game was a Linux OS image and supporting tools, I probably wouldn't notice.

Having a standardized Linux image with containerization support shared across the entire industry could be a really powerful tool for game developers who want to target Linux but don't have EA's budget. Over time, this could put Linux on equal footing with Windows in terms of platform support cost.

That's not going to happen. The main benefit of developing natively for windows is that the game should pretty much compile for Xbox straight away, with some minimal changes to the code. The PC build is almost a byproduct here. I don't personally see devs making a linux-but-not-really version for Windows if that cuts them off having a "free" xbox version. And from financial point of view having a Linux vs Xbox version is almost a non-starter, unless you're targeting some hyper-nieche.

steam does not run games in containers.

Not yet, but:

https://www.phoronix.com/scan.php?page=news_item&px=Steam-Li...