I think there's a bit of a distinction between patches that add functionality not accepted by upstream (as here) vs the more typical distro patches which do things like replace bundled libs with shared ones, fix locations for things like TLS bundles, that sort of thing. These can still break things, but much less frequently.

I haven't been a distro packager in many years, but my recollection is that in other distros (debian, fedora, arch, etc) patches that add new functionality would generally not be considered okay unless accepted by upstream. I'd be interested to learn the rationale for not upstreaming this patch before including it.

Arch's policy is to minimize patches. I think the linux kernel runs on about 2-3 patches on average per release, most other packages aren't much more either. The policy "minimal patches & close-to-default" is in my experience usually a great one to avoid package maintainer issues.

We don't have any policy. Sticking with upstream is a shared value between the packagers but it's important to note that we generally don't enforce any policy. Most packages has no patches. Usually it's regressions or security patches if there is anything.

Current linux release has one patch changing one default: https://github.com/archlinux/linux/commits/v5.9.8-arch1

The wording on this page suggests that it is a policy:

https://wiki.archlinux.org/index.php/DeveloperWiki:Patching

As you say, the page notes that "[the] policy is intended to suggest, not to enforce", but having a policy is orthogonal to enforcing it.

And as a packager for Arch the past 3 years: I had no clue this page existed. Evidently we are bad at these policy things. But I'd rather call them social norms then packaging policies.

Even unspoken or badly specified policies can be policies. Just unwritten ones in that case. I thoroughly enjoy this one.

Or why are other packages patched? Is it because it takes long to accept them at upstream?

But why is kernel is patched by distros at all? I run kernel from kernel.org always and don't see any issues.

On arch, patches are usually done to either customize the build version (the kernel is 5.9.xy-arch1 for example, that's the only patch), or to make them build with the newer compiler and libs present on the system. Additionally any patches necessary to make them work at all, though in my experience rare.

Yup. Even Arch.

What about slackware? Its been a couple decades but I used to get my kernel source from linux direct and never had problems.

With respect to upstream patching, Slackware is similar to Arch, it has a few, but generally tries to stick to upstream. Kernel is unpatched though.