Games

The games won't work. Games that are PS5 and not PS4 will not work correctly with hardware that is inferior, because they're built and tuned to one specific hardware profile. You can't just "render at lower resolution and settings" without active dev involvement. Hyper optimization literally to the point of very specific clock cycles of very specific sequences of instruction calls is the entire value proposition of a console. The build will not function properly on hardware that can't match it exactly.

Low end games that don't need the hardware will already work on a handheld PS4 because they already have PS4 versions. It is not a PS5 if there is one single PS5 game that doesn't work exactly identically to an actual PS5.

Xbox series S plays the exact same games as the series X because Microsoft refused to allow games that didn't work on the shitbox, leading demanding games to skip the entire system instead. There's a reason Sony completely dominated this generation in sales volume, even for multiple years of supply chain disruption when Xboxes were freely available and PlayStations required months of wait time. It's because the entire premise of the series S is a deranged idea with no redeeming factors.

It can't offer downscaled graphics without developers actively making changes to support it. That's not how console builds work, even if we pretend the GPU is all the power draw you need to eliminate. If there's one single PS5 title it doesn't support, it is not and cannot be described as a PS5.