In my experience of using two laptops and now two dedicated desktop GPUs, overheating is usually not a problem of a game engine. It’s a result of a poor cooling solution. My laptops had puny hd7670 mobile and mx450 GPUs back when I got them. But they were really poor at cooling them, my work laptops also have the same type of problem despite having very low end gpus, but after I got to to desktops with much more power hungry gpus but in an well ventilated case, they never reached those scary temperatures. My rtx 3080 used to run at 70-80 degrees most of the time. And my RTx 4090 is even cooler despite being much more powerfull. That thing runs at 65 degrees when the fans are spinning. Because, they have much better cooling solutions attached to them.
Now coming to how to balance this, a game engine will try to use as much resource it needs for the applied settings, or as much as it can get before reaching the resource limit. MSFS will use as much resource it can get from the system, if you don’t limit it somehow. And there is nothing wrong with that. Problem is, if a device is capable of using up 200watts but was not designed to cool 200watts effectively, then it will overheat.
Now what are your options?
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You can either put a lower power limit to your devices like CPU and GPU. But that WILL reduce peak performance.
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You can make adjustments to your settings so that it doesn’t use as much resource as in ultra and uncapped framerate. But you are unwilling to adjust settings, ok, then call framerate, for that you can use VSync, but that causes some judder in your system, ok, then don’t use Vsync, but cap framerate using an external tool like MSI afterburner and rtss. That should do the trick without using Vsync.
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Best but difficult to achive option: try get your cooling solution to match your heat output like you did by cleaning and reapplying the thermal interface materials.
At the end of the day you will need to balance your systems heat output and cooling capability. Option 3 is about adjusting your cooling capability, options 1 and 2 are about adjusting the heat output.
Even if Asobo somehow adjust the game engine to use less resources (i am not sure Vulcan is magic, Xplane is a different engine with different capability, it’s not apples to apples comparision), your system can still try to use full resources available by trying to run at a higher FPS. You have to cap that FPS somehow, it’s like putting the brakes on your car before it reaches top speed. Except most of us don’t want to put a brakes on our CPUs/GPUs so that we can achieve Max fidelity and performance. But if temperature is an issue for you, you have to accept that and aim for lower performance.
Although I am having a bit of trouble understanding why a card like 6700xt having cooling issue. Is your case well ventilated? As far as I remember from last round of AMD reviews, Navi 2x cards can have hotspot temperatures of near 100 degrees and they still should work fine, they are like that by design. But this was said by AMD. So don’t know if that is the actual case or damage control, not sure about that. May be it is cause zen4 CPUs are running at 95 degrees and Intel 13th gen CPUs are running at 100 degrees these days and that’s by design.
And to test the worst temps you can get, may be try running a furmark stress test. You will see temperature spike.