Could not initialize graphics resources; game may be using an unsupported graphics API

[Joseph O'Callaghan]

I keep getting this on every game I try at the end of my logs:

19:26:44 [17632] Initializing Oculus frame submission...
19:26:44 [17632] Game is using D3D11 swapchains, initializing D3D11 resources
19:26:44 [17632] Swap chain has format 7, bind flags 1 and misc flags 1
19:26:44 [17632] Eye 0: submitted textures have resolution 4576x2368
19:26:44 [17632] Eye 0: output resolution is 5384x2786
19:26:44 [17632] Creating output swapchain in format 7
19:26:44 [17632] (!) ERROR: Failed to create graphics resources: Failed creating output swapchain: (-7000)
19:26:44 [17632] (!) ERROR: Could not initialize graphics resources; game may be using an unsupported graphics API

I am running Nvidia 3060Ti. Latest GPU drivers.
I am running via Virtual Desktop, is this an issue?
I seems that get the affects of FSR, I am definitely able to boost my Resolution and get better performance.
FFR may be the issue here. As the debug visuals don't work for me. Ctrl + F1.

I've tried several games that are supposed to fully work; Contractors and Covert Ops to name two.

[Joseph O'Callaghan]

Just adding to this in case anyone has any input or the dev sees this.
I noticed this is only happening for Oculus runtime games!
In Steam VR it all works fine, but since I am using a quest 2... I would rather use Oculus runtime.
Not sure if this is a known issue...