Tried couple of things - I got it to do that as well when I changed the "Input EDID Mode" to "Merged", which seemed to be the Default setting.

Could you clarify that your "Input EDID Mode" is set to "Display" - mine seemed to maintain the set resolution if it's set.
Also Make sure to Hit "Apply"!

One last little extra thing as part of this thread - if you want to try streaming your game capture to Discord and don't want to stream the capture utility, you should be able to select the Capture Card under the "Devices" tab.

Make sure you set the Audio device for the stream/screen share as well.

You might be okay as long as your set the Format to record at 4k - although this might the capture software up-scaling it,
Since think the Switch 2 will still rendering at 1080p.

Not sure if you can have the Switch render at 4k, then have your Elgato pass a 1080p signal to your monitor.

Let me try

Boat go-

Flat cat Sunday