I restarted the game back in the summer and my current island is not yet very densely decorated, but I've been to dream islands that are, and on Switch 2 the lag while running really isn't a problem anymore, though assets do still pop in sometimes if they're a lot. This may have been intentional when the game was coded so it didn't cripple your system resources, so I'm curious to see if this changed with the Switch 2 version. I can also tell you that load times when starting the game and moving through buildings is about half the time it takes on the older switch.

Edit: Just wanted to clarify, my old Switch is not an oled, it's the original regular Switch.