Performance
OK, so we got the price point out of the way; so lets take a look at the performance aspects of the system.
Before posting the results from around the web, let me just post the Steam Machines specs for reference:

Gamers Nexus and Digital Foundry did very good review of the system (links are for their respective websites with video embedded):
Gamers Nexus
Digital Foundry
Lets check out some of the performance comparrisons from DF:



The steam machine's performance as per DF falls between -9% to -18% of that of a custom build using a Ryzen 5600X and desktop RX 7600.
Lets move on over to Gamers Nexus and what they see:



These are the GPU exclusive tests as its compared to a rather beefy 9800x3d CPU which can indeed change the overall outlook of the performance. You can mitigate the CPU performance difference through in game settings so you can compare the GPU's and CPU's separately. So lets take a look at their Kingdome Come Deliverance 2 CPU and GPU comparison:


As you can see the CPU is a rather bottleneck here as its overall performance is below that of a second generation Ryzen processor 2600X. In terms of the same game, the GPU does seem to fall, on average, between RX 6600 and RX 7600 desktop GPU's.
Lastly, lets go back to DF and see how well it compares to the base PS5:


I am not gonna obviously post both their entire articles on here cause that is stealing. I am just giving some examples of what they found from their testing's. As you can see, the Steam machine does match or slightly matches the base PS5.