In the last iteration of TSW6 I was able to enter the settings menu while playing a game. For example I want to adjust something in the hud. The new TSW7 doesn't let me do that in fact I can't even exit the without pressing the Steam key and actually closing the game down. Is it intentional, is it a bug, or am I missing something? I'm playing on the Steamdeck.
This is indeed a mistake. On PC with a gamepad, it's exactly the same. You just have to use a mouse, although in Part 6, all this was done with a gamepad.
Weird, I play on PC (Steam) with a game controller and can access the settings from the pause menu using the left and right shoulder buttons. I even have button icons at the top of the screen.