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My temporary solution has been just using my controllers wired, and that seems to work just fine.
One temporary fix I've found was turning Steam input on or off, didn't seem to really matter which mode it is enabled when it occurs since it occurs in both. Another temporary fix is turning off bluetooth on the PC which turns off the controller, a hard reset basically. But they're only temporary because it happens again while in the same playthrough. Sometimes it's hours, sometimes it's 30 minutes, but it seems to always happen now. Reinforces my theory that this is a Steam issue, but nobody has a fix.
Worst culprits right now are Tainted Grail and Ready or Not. I just recently got TG so that might have its own performance issues, but the controller lag is undeniable. Ready or Not had zero issues until earlier this month (July 2025). Mechwarrior 5 has been my test platform between Steam/no-Steam, might try older more stable games like Space Marine 1 later, but the problem seems software related in the Steam side so far.
Modern apartments and gamer rooms have many wireless sources/devices.
Wireless mouse, keyboard, speakers. Wireless modems and routers, wireless headphones, printers, etc. Most of them use the same frequency of 2.4 Ghz.
All that can cause interference - problems with the signal. Try a wired connection via a USB cable.
The distance of the controller from the BT dongle is another problem. Furniture, walls, metal elements can block or distort the signal. So try to bring the BT dongle closer to the gamepad.
In my room I don't have many EM sources. Only my smartphone and router, but my PC is connect to the internet with a cable. Also my BT dongle is very close to my Xbox gamepad.
When i play the distance between the gamepad and BT adapter is less than 100cm or 1m.
I use Xbox series S/X controller - model 1914.
https://en.wikipedia.org/wiki/Xbox_Wireless_Controller
Keep in mind that Xbox controllers since Elite 2 model 1797 use only bluetooth BLE - or low energy BT. So other stronger BT sources can and will affect it.
I hope it helps a bit.
I'm not having this issue anymore, but it seems that this still happens for some. In my experience, I was able to play games on other platforms with my controller wireless with no trouble at all, while it was a consistent issue over steam.
Honestly I don't remember at all when the shift happened and it started working again, so I can't really add onto this much.