Systemd not respecting timeout config?

no, they are not
read as:
I beg to differ :wink:

What is missing here to make progress is:
information …

ps:
problems with mouse - in another thread

Mouse takes minutes to start working on boot after recent update

and you have
a lot
of custom
grub kernel boot options set

acpi_osi=! acpi_osi=Linux
    "acpi_osi=Windows 2009" nogpumanager intel_idle.max_cstate=1
    i915.enable_gvt=1 i915-enable_fbc=1 pcie_port_pm=off iommu=pt
    intel_iommu=on kvm.ignore_msrs=1 rd.driver.pre=vfio-pci
    default_hugepagesz=1G hugepagesz=1G hugepages=0 transparent_hugepage=never

I’d start looking there …