I don't notice any image quality losses with AFMF. Most people won't too. All the videos that complain about Frame Gen are literally at 20% speed and 500% zoom as if that's realistic during actual gameplay lmao.
Also, the frames aren't "fake", they're very real if you're using frame gen properly, noticeable in gameplay. As real as the other frames at least.
Chill disables itself in the most important moments like menus and loading screens. You'd be probably better off locking the game to 60 fps with something like RTSS if you want to double it to 120 and would work better, I'd presume.
With most games running at 30 fps there? I doubt it. Not only will you not notice a difference, but AFMF actually takes a performance hit to work so it will double less than 30 frames. If you have 60 fps tho, that's good, given the new steam deck oled has a 90hz screen.
If you get 120 fps with frame gen and 60 fps without, sure it doesn't feel like 120 fps but it definitely feels like 80-100 which is an improvement. That's my personal experience with a mouse, I don't play with a controller.