Xenoblade Chronicles 3 is playable, despite several issues. Minor stuttering is to be expected, as well as some graphical issues, particularly with the Vulkan renderer backend. These issues can be avoided by using the OpenGL rendering backend, or by using mods. Crashes can happen after playing for some time, so we advise that you save often or use auto-saving.
For Vulkan users, we highly recommend that you use the Bloom/Brightness Bug Workaround Mod to make the game significantly more playable. Credit to theboy181 for providing this workaround that makes Xenoblade Chronicles 3 much more enjoyable with yuzu. The team continues to investigate and fix these issues and will provide an update here as appropriate.
See yuzu Switch Mods for more details and a more up-to-date list of mods for this title.