I am assuming you have the monitor connected directly to the 7800xt. Which is why it is the default GPU.
Is the decoding being done when watching the video¿? amdgpu_top shows if the application(vlc in this case) is using the decoding hardware(column named DEC).
Also using the iGPU for video decoding should be more efficient because the massive number of cores in dGPU aren’t needed while decoding yet are kept active because the dGPU is active