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Haven't used Kodi but am running Jellyfin via the official docker image on a Raspberry Pi 4. Even there transcoding works reasonably well for one user at a time, admittedly didn't try with several users at the same time so far.
Just mentioning the docker image because I used to install it without docker directly via the repository and I never got transcoding to work on the same hardware.
It still transcodes it just uses the CPU