In my opinion, the biggest reason for the resurgence is that there are no more handheld consoles anymore. At least not traditionally. The Switch, and portable PCs like the Steam Deck et al are PORTABLE, but not pocketable, which is the real test of handheld consoles. More like a “put in your backpack” at best.

Physical media/media ownership may contribute, but Switch is pretty good about that, and it is easy to pirate on PC.

Hardware manufacturers have noticed this, and there are some Android based emulation machines that copy the form factor. If I wanted such a device I’d go for that, most can emulate 3DS with better resolution. But there’s something to he said for the simplicity of popping in the game and that’s it.