[Samsung Galaxy Tab S7 / S7 Plus Questions & Answer] LSS4181:
UPDATE 2: Sadly the situation has worsened during the period and the touchscreen loses responsiveness much more often that some games are virtually unplayable. I've moved the games back to my good old Pixel C. Although it's indeed ill-equipped to play some newer games (that they have very low framerate and could sometimes slow down to a near-frozen state, even on lowest detail settings), at least I've no issues with its touchscreen, just that games may get too low framerate to accurately register them on time.

Should point out that S-Pen is apparently not affected by this issue, even with GSI, because S-Pen is treated as a pointer device (with significantly higher sampling rate) and in most cases does not count as touchscreen taps but instead count as left-clicks (e.g. games that exclusively expects touchscreen taps rather than mouse clicks would not respond to S-Pen taps, which is intended). Because of this, whenever I have the issue in-game I always need to pull out the S-Pen to perform some actions, like opening up the ingame menu, or bring up the navbar and go back to home screen, as I usually would have difficulty doing it directly with fingers whenever that happens (usually needs 3-4 taps/swipes to actually get it register once, but with S-Pen it always worked on first try).

Maybe I indeed have a faulty hardware (it doesn't matter anymore now that I've voided my warranty), but the possibility that software issues are contributing to the problem remains high, so for now I have no other choice but to follow kernel and ROM development process for a while to see if there are possible fixes/mitigations. Given this experience, I'm considering looking for another Android tablet with similar features this year but I'm yet to see one (especially considering 120Hz), and of course, I most likely won't get another Samsung device for serious purposes from this point on.

EDIT: Guess this Reddit thread about Galaxy S20 FE is relevant as many issues mentioned there seem to match mine... so this might be an issue specific to Samsung in overall, not just this device.

UPDATE: I'm putting the original post inside a spoiler as the old stuffs were a bit messy and outdated. Most of the original post were written during Android 10 and things have changed quite a bit since then.

Simply put, the touchscreen of this tablet is a bit problematic which makes it not a good idea for serious gaming, though it doesn't seem to affect office/production use as much.

The cause is still unknown and I can't be sure if this is due to hardware or software, or a mix of both. Should point out that the issues persist after switching to a GSI, so the stock ROM is not entirely to blame.

Some ongoing issues:

1. Touches randomly fail to register, and with inconsistent response time (sometimes early or late than average).

2. Touchscreen occasionally stops responding, dropping or delaying a lot of taps. This has become worse since BUD2 as I started having longer periods, and now virtually no touches get registered when it happens. I wonder if this is a side effect of the ghost tap mitigations, as this becomes significantly worse since BUD2 while I hardly ever get any ghost taps since then.

3. Jittery scrolling. Apparently I'm having this issue for quite long. Bounces (a quick scroll in reverse direction) can happen in apps when releasing the finger after scrolling. In games, this bounce registers as an additional flick. Should note that this is actually an indicator of the problem. Whenever I start noticing additional flicks being registered, the actually problem (touchscreen losing nearly all responsiveness) will likely kick in after a while.

Some issues appeared to have been mitigated after FW upgrades:

1. Ghost taps during holds and swipes. This has become lessened since Android 11 and is mostly gone since BUD2.

2. Random auto taps at the edges of screen. Haven't gotten once since BUC1 but I can't be sure it's really gone away.

3. Touches may get registered prematurely (when finger is still a few millimeters away from the screen). This has become lessened since Android 11.

Spoiler content hidden.