The new Gamepad UI detects and responds when testing the controller in the configuration, but in-game, touchpad input is ignored. I tested it on No Man's Sky and Death Stranding.
I also tested without disabling default linux behavior to treat touchpad input as mouse cursor movement and it confuses Steam: if I press the touchpad, the game acts as if pressing a keyboard key and switches to show keyboard prompts, but if I also move the thumbsticks, the game goes back to showing Dualshock button prompts and furthermore, when pressing the PS Guide button, the UI moves my mouse cursor in the top left direction slowly.