The Steam Deck OLED is an improved Deck rather than a Steam Deck 2. Performance is about the same, but nearly everything around it is better.
Screen
A 7.4 inch HDR OLED at 1280 x 800 and up to 90 Hz, against a 7 inch 60 Hz LCD on the original. Colours, contrast and HDR are much better, and the higher refresh rate makes games feel smoother.
Battery
A larger 50 Wh battery and a more efficient chip give noticeably longer play time.
Other upgrades
Faster Wi-Fi 6E, a lighter body, better thermals and a longer charging cable.
Which to buy
If you are buying new, choose the OLED. If you already own an LCD Deck and are happy with it, the upgrade is a luxury rather than a must, since games run about the same.