Screen tears in factorio unless mouse is moved

[Arroquw]

Very weird issue, I am on NVIDIA and when I play factorio, the screen has glitches at the top whenever the player moves (on DP-2), unless I'm also moving the mouse. The screen tears, or seems to offset the top 15% or so of the screen like 5 pixels to the left from the rest of the screen, and flickering between offsets.

The issue is either fixed by enabling hardware cursors (but that brings its own issues with cursor not being in an accurate position - rather under it, which is very annoying - and it disappearing as soon as I stop moving the cursor, or it is fixed by setting the monitor to a fixed 60Hz rather than 165Hz.

I have the following configs enabled:
VRR does not seem to matter. My monitor is 165Hz, and setting it to 60Hz solves the issue, but enabling/disabling VRR does nothing

cursor {
  hide_on_key_press=true
  min_refresh_rate=24
  no_break_fs_vrr=2
  sync_gsettings_theme=true
  use_cpu_buffer=2
}

general {
  allow_tearing=true
  border_size=2
  col.active_border=rgba(5e81acff)
  col.inactive_border=rgba(33333366)
  gaps_in=1
  gaps_out=1
  layout=dwindle
}

misc {
  allow_session_lock_restore=true
  disable_hyprland_logo=true
  disable_splash_rendering=true
  key_press_enables_dpms=true
  mouse_move_enables_dpms=false
  vfr=true
}

render {
  direct_scanout=1
}

monitor=DP-3,2560x1440@60,0x0,1,vrr,0
monitor=DP-2,2560x1440@165,2560x0,1,vrr,2

I omitted configs I didn't deem relevant for this issue.

Game is running in wayland by setting SDL_VIDEODRIVER="wayland". Running in gamescope or xwayland does not fix the issue. As I mentioned earlier, moving the mouse fixes the issue as well (but isn't feasible to keep doing, obviously). I guess a workaround is to set the monitor to 60Hz when launching the game and setting it back with hyprctl reload when done, which is only slightly annoying. Enabling hardware cursor is not feasible due to the issues it brings.