That really means nothing. Kodi 17 has been absolutely horrid on the majority of Android devices out there while excellent on others that Team Kodi favors from day one (eg. Shield). Aside from being obsolete due to its lack of x265 support, the Raspberry Pi is a popular and standardized hardware set that makes Team Kodi's ability to implement device-specific enhancements very easy and practical where possible, and they have an official build specifically dedicated to the device range. The same cannot be said for every flavor of chipset out there across countless Android devices.
The new VideoPlayer "(software)" (as you put it) is the interface for all hardware interaction for playback. Whether it offloads to hardware based decoding when present or CPU-intensive software-level decoding when not, it's involved in every video you attempt to play. Of course it has an impact. It's the entire backbone of Kodi's video playback.
To explain it in what I would hope is a sound and logical manner for you, my understanding is that LE 7.90 Krypton builds are still using the same drivers/kernels/device trees as the Jarvis build you're indicating works OK. The only difference is that the build is compiled with Krypton rather than Jarvis. If not for changes in Krypton itself (which there are many), you should for the most part be able to expect the exact same overall performance from it as you would Jarvis. Unless a tweak was present in the Jarvis LE builds that improved performance in scaling but is no longer present, it's not LE build related. It's a Kodi issue.
To be clear, I'm not saying that there are no optimizations that may be possible on the LE side. That is definitely the beauty of kzsaq's builds... They can be far more optimized than stock Kodi ever could, because he has the luxury of optimizing for a more limited device range than Team Kodi does. I'm still relatively new to these builds overall myself, so I'll let kszaq weigh in rather than insist upon external factors to LE being the root cause. I'm simply reminding you that there's an entirely new engine under the hood in Krypton, and I'm suggesting you attempt to reproduce on alternate platforms to confirm if it's expected behavior. For one, if you run Kodi 17 through Android on that same box, is the upscaling any better? I'd suspect not, and that right there would confirm it's not an LE level issue and would be better served engaging Team Kodi for. My point is largely a reminder to temper your current expectations regarding Krypton.