So Ive been tinkering with SDDM for running it in Wayland mode, here is a pkgbuild for my current configuration for anyone who would like to try it out.
This currently uses weston as the compositor to avoid weird things with using kwin as SDDMs compositor. You may switch to kwin if you like following this guide here
https://wiki.archlinux.org/title/SDDM#Running_under_Wayland
Current issues (1/31/2023)
Blur does not work with the Breeze theme, themes without blur look just fine
Running GreeterEnvironment=QT_WAYLAND_SHELL_INTEGRATION=layer-shell with weston doesnt work, it does with Kwin but using kwin results in some weird behaviors resulting from SDDM being treated as a window. If switching to using Kwin add the above greeterenvironment to the [general] section of 10-wayland.conf
if you find other issues please either report on the gitlab so they can be tracked to see if there are future patches for it or it needs to be reported upstream