Yeah, this. T239 supports HBR3 over up to 4 lanes and, unless Nvidia have suddenly regressed in their DisplayPort controllers, can safely be assumed to be DP 1.4a. With either DSC or chroma sub-sampling it can hit 4K/240Hz or 8K/60Hz with HDR, and combining DSC and chroma sub-sampling it could actually push 8K/120Hz with HDR if really needed.
I haven't used DSC myself to verify whether it is indistinguishable from uncompressed (I wouldn't be too surprised if it is, given the low compression ratio), but it's probably worth noting that DSC is part of the HDMI 2.1 spec as well, and is required to hit higher resolutions and frame rates. For example, HDMI requires DSC to hit 8K/60Hz, so if Nintendo went a little crazy and attempted to pump out 8K/60fps visuals on The New Machine the DisplayPort connection wouldn't be a bottleneck, it would be capable of an identical signal to HDMI 2.1.
In any case, I don't expect 4K/120Hz support on The New Machine, not out of any technical limitation, but from a business perspective it doesn't make a whole lot of sense for Nintendo. TVs with 4K/120Hz support don't have massive market penetration, and Nintendo would almost certainly want matching functionality in both handheld and docked mode, which would mean a more expensive 120Hz display. Meanwhile even if it's a big leap over the current Switch, we're still talking about mobile hardware, so pushing very high frame rates probably isn't the most effective use of the performance they have. Even the much more powerful PS5 and XBSX will have very few new games running at 120Hz now that the cross-gen period is ending.
Interestingly, the DisplayPort interface described in the Linux source code definitely isn't the same as the one on Orin, as it's implemented as part of a UPHY interface, whereas Orin has a dedicated display interface which supports both DP 1.4a and HDMI 2.1. It's possible they have also retained the Orin display interface, perhaps to support HDMI out for devices like a new Shield TV, or that the leak merely refers to the DisplayPort capability being the same, rather than the actual controller itself.