Solved NVIDIA driver weird issue: games lag and is on low FPS, but reinstalling driver fixes the problem until restart

UPDATE: The issue seems to have been fixed, so I will mark as solved, but I'm still going to keep a watch on this one.

What did it for me was resetting voltage. I shut down my laptop completely, making sure it is unplugged (my laptop does not have removable battery), then held down power button for 15-20 seconds, then started it back up. Testing the games out, even made sure to double check by hibernating and then resuming (since hibernating triggered the issue again), and so far there's no lag, everything is back to how it should be (GPU usage hovering at 50% give or take for Genshin, 60 FPS, etc.) Therefore I'm thinking somehow there was a bit of voltage issue which resulted in the GPU acting up incorrectly, and a simple voltage reset fixed things to how it should be.

I realize it's so unorthodox and random, but hey, next time I have this issue, I will at least remember to look at this one. I usually love hibernating because I want to continue on the fly, it's not too different from shutting down.

"I shut down my laptop completely, making sure it is unplugged (my laptop does not have removable battery)"
Maybe, but most Laptops have a switch in the UEFI/BIOS for disconnecting the battery.

You probably don't know, but there are voltage regulators in various areas of a laptop. They are there because of variations in the battery voltage and when running off the charger.
So your hard reset would not have changed voltages where it matters.