(Flatpak/Wayland) steamwebhelper fails to launch, seemingly missing $DISPLAY #10554

Your system information

• Steam client version: 1.0.0.78 (flatpak latest)
• Distribution : Alpine edge, Hyprland 0.35.0 with xwayland installed, flatpak 1.14.5
• Opted into Steam client beta?: No
• Have you checked for system updates?: Yes
• Steam Logs: steam-logs.tar.gz (this is with STEAM_LINUX_RUNTIME_VERBOSE=1 set)
• GPU: AMD R6800XT

Please describe your issue in as much detail as possible:

steamwebhelper fails to start on a completely fresh Steam Flatpak install, on a completely fresh Alpine install as well:

It still worked 3 days ago when i downloaded Elden Ring without playing it, and even yesterday, when I was trying to get the game to launch. At some point i closed Steam and it hasn't worked once since. I have uninstalled Steam and even reinstalled my OS entirely, still nothing. I assume it updated when it started up again, but I don't remember for sure (my memory sucks 😅)

I've seen plenty of people have issues with the newest version of steamwebhelper, but I haven't seen anyone with these lines in particular in steamwebhelper.log:

[0229/142354.032593:ERROR:ozone_platform_x11.cc(238)] Missing X server or $DISPLAY
[0229/142354.032616:ERROR:env.cc(255)] The platform failed to initialize.  Exiting.

The terminal output shows that Steam tries to launch steamwebhelper via the sniper runtime 3 times before giving up and displaying the error popup.

Some other recent issue mentioned running run-in-sniper vkcube which also fails with:

Environment variable DISPLAY requires a valid value.
Exiting ...

even when explicitly setting $DISPLAY to :0.
Curiously, out of the 3 env variable dumps that appear in the verbose steamwebhelper.log, only the 3rd one seems to be missing DISPLAY.

Steps for reproducing this issue:

1. Install Steam via Flatpak (flatpak install com.valvesoftware.Steam)
2. Run Steam