This was happening to me too but I fixed it by installing xdg-desktop-portal and the proper backend for it (xdg-desktop-portal-kde in my case).

xdg-desktop-portal causes problems when installed. If you start to notice various applications suddenly take 5, 10, 30 seconds to open when they used to be instantaneous...xdg-desktop-portal.

On my side I no longer have the issue although I am not sure of which exact action fixed it: At some point a system update prevented me to start entirely Steam and I ended up both removing xdg-desktop-portal-gnome and installing lib32-libnm .
Since then, steam starts fine and I was able to change the uncompressed screenshot folder without crash.
I suspect that it was removing xdg-desktop-portal-gnome that did the trick (Now I have instead xdg-desktop-portal installed).

Same issue

• Steam version: 1702079146
• Steam Client Build Date: Fri, Dec 8 03:33 UTC -08:00
• Steam Web Build Date: Sat, Dec 9 02:30 UTC -08:00
• Steam API Version: SteamClient021
• Distribution: Artix 6.6.7
• Opted into Steam client beta?: [Yes/No] No
• Have you checked for system updates?: [Yes/No] Yes

I had the same issue, using Arch Linux.

But I found a workaround for myself, and maybe this information can help to find the root-cause(?).

So, the setting that should be set is part of ones usersettings, in the local config file.

~/.local/share/Steam/userdata/<USER_ID>/config/localconfig.vdf

Looking inside it, there was a config block that reminded me of the other settings for screenshots, like button and such:

        "system"
	{
		"PushToTalkKey"		"0"
		"EnableGameOverlay"		"1"
		"EnableSCTenFootOverlayCheckNew"		"0"
		"InGameOverlayShortcutKey"		"Shift	KEY_TAB"
		"InGameOverlayScreenshotNotification"		"1"
		"InGameOverlayScreenshotPlaySound"		"1"
		"InGameOverlayScreenshotSaveUncompressed"		"1"
		"InGameOverlayShowFPSContrast"		"0"
		"InGameOverlayShowFPSCorner"		"1"
		"InGameOverlayScreenshotHotKey"		"KEY_F12"
		"NetworkingAllowShareIP"		"0"
		"NavUrlBar"		"0"
		"displayratesasbits"		"0"
		"GameOverlayHomePage"		"https://duckduckgo.com"
		"InGameOverlayScreenshotEnableAVIF"		"1"
	}

This block seem to be missing the key "InGameOverlayScreenshotSaveUncompressedPath".

So I manually added it under "InGameOverlayScreenshotEnableAVIF" with two tabulars to the next string (the path to the external save folder) like so:

		"InGameOverlayScreenshotSaveUncompressedPath"		"/home/user/my/path/to/screenshots"

And upon next restart of the steamclient, the path seem to be set in the folder, and my new screenshots are now saved there!! :smile::white_flower:

And like @omnigenous pointed out below, before editing and saving the localconfig.vdf config file, make sure that steam is closed, so it cannot overwrite your edit.

After I had set this variable, steam will still crash upon trying to set the folder through the GUI.
But at least I am happy that I found this workaround in order to set it manually!

Hope this info may be of help for anyone running into the same problem!

@kazie Thank you! Note that your steam client needs to be closed while you adding this to config, otherwise steam client will overwrite this config on exit.