Not wanting Steam is the biggest issue. They could include further shops and even individual games. There also needs to be an option for people who want to do scientific computing. Having vouchers from scientific institutions would exclude everybody who is independent. The approach has to be refined a bit, but the general principle is that you can link cards to individuals.
To balance the downsides, Nvidia doesn't have to go all in on 'Steam sales', like Sony, who sells some of their PS5 to registered gamers but not all of them.
On the other hand, I don't see the problem with damaged or lost cards. Damaged cards can be treated like guarantees: send in your damaged card and buy a new one. Lost cards on their own are a problem but how do you lose your card? You have to lose your entire gaming rig which most likely means that it is stolen. So send in a copy of your police report. That way, miners will be punished for wrong legal proceedings if they make a business out of 'losing cards'.