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FSR3 will support all graphics, but best results are only guaranteed by using supported GPUs. FMF will only support RX 7000, too.
Nvidia is not forced to do anything about that. They use dedicated hardware units (Optical Flow Accelerators) Radeon graphics do not have. Only RTX 4000 graphics have these OFAs. It's a different approach while AMD uses Software for FG (AMD term: FMF)
I don't think Nvidia will offer a software solution as well.
FidelityFX Super Resolution 3 has two main features: frame generation and latency reduction technology. According to AMD, the use of a new upscale can significantly improve performance.
For example, in Forspoken, the frame rate when using FSR 3 increased by more than 3 times. If desired, players will be able to enable only the generation of frames, leaving the native rendering resolution.
Upscaling FidelityFX Super Resolution 3 will work on both AMD and Nvidia graphics cards. AMD supports graphics cards starting with the Radeon RX 5700, but it is recommended to use at least the Radeon RX 6000 series.
Among Nvidia graphics cards, only the GeForce RTX family will support FidelityFX Super Resolution 3. It is recommended to use cards from the GeForce RTX 30 family or faster.
Ok but when fluid motion is available on every DX 11 and 12 game that means AMD can show benches with their $500 gpu's performing on par or better than Nvidia's $1200 gpu's.